Hong Kong Property Sector Recovery

Hong Kong's property sector has bottomed out and is entering a new bull market phase driven by mainland demand and interest rate cuts. SG recommends gaining exposure through the SGBHKREI index of large-cap HK developers.

Key Takeaways

• 1.The Hong Kong property sector found its cyclical bottom in mid-2025 and is now entering a recovery and rerating phase.
• 2.Interest rate cuts in 2025 have driven transaction volumes to their highest levels since 2021, with over 5,000 units sold monthly for 11 straight months.
• 3.Mainland Chinese investment has become a structural pillar of demand, accounting for approximately 20% of total transactions in 2025.

Table of Contents

• Asia Equity Strategy
• Leading indicators point to further rise in prices
• Commercial property rentals have started to stabilise selectively
• Sector leverage has fallen to a three year low level even as valuations remain undemanding
• SG HK Real Estate Basket (SGBHKREI)
• Investment Policy
• APPENDIX
• ANALYST CERTIFICATION

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