Hong Kong property outlook clouded by Trump, rate uncertainty despite November price rise

Hong Kong’s home prices and rents moved in opposite directions last month, with market observers saying uncertainty over the interest rate outlook and Donald Trump’s return to the White House could weigh on the sector next year.

Prices of lived-in homes rose marginally for a second consecutive month in November. The city’s closely watched residential gauge rose 0.06 per cent to 290.9 in November from 290.7 in October, according to data from the Rating and Valuation Department. In October, home prices rose for the first time since March, increasing 0.87 per cent month on month.

For the first 11 months of the year, home prices fell 6.55 per cent, the data showed. Prices have slumped 27 per cent since hitting an all-time high in September 2021.

“We have observed residential prices have stabilised after declining for five consecutive months,” said Eddie Kwok, executive director for valuation and advisory services at CBRE Hong Kong, adding that a clearer outlook for home prices is likely to emerge after the Lunar New Year festivities next month.

He said that Trump’s re-election was viewed as a major “uncertainty” factor by the market.

Last month, HSBC, Hang Seng Bank and Bank of China (Hong Kong) cut their prime lending rate for the second time this year to the lowest in two years. The trio lowered their prime rate by 25 basis points to 5.375 per cent. Standard Chartered, Bank of East Asia and ICBC (Asia) also dropped their rate to 5.625 per cent, resulting in lighter mortgage rates for homebuyers.