A property analyst says housing prices are bottoming out and should stabilise next year, with possible growth of under five percent. Hannah Jeong, head of valuation and advisory services at CBRE, was commenting after official data showed that home prices went up in October after declining for five months. Data showed private residential prices were up 0.6 percent month-on-month. In September, prices dropped to their lowest level in eight years. Rents in October recorded their first fall since February, falling 0.3 percent month-on-month. Jeong said the major reasons for the upswing in prices were local banks lowering their prime rates after the US central bank began cutting interest rates in September. The government relaxing the maximum loan-to-value (LTV) ratio for all residential properties to 70 percent, regardless of the value of the property and whether it is for self-occupation, also had an impact, she added. "I think we only have three or two months to go. So the decline or the overall negative growth will continue within this year," Jeong said. "But 2025, possibly we are bottoming out and then see slight positive growth, possibly less than five percent, or remain stable or flat. So that's the forecast for 2025." The analyst noted the rental market was performing quite well, with a yield reaching about 3.3 percent. She said she expected this upward trend to continue in 2025, due to the number of people entering the city under various government talent schemes. Jeong also said there was a very strong desire for home ownership in Hong Kong, and next year, when the supply of new flats was expected to peak at around 26,000, this would provide a good opportunity for potential homebuyers. "So I think we are facing the supply peak, obviously, at the wrong time. But this will give a good opportunity to homebuyers. People were waiting a very long time and unfortunately during Covid, people thought the market will be soft. But we had a 2020 price peak and people are losing money, whoever bought at that moment," she explained. "So now people learned a lesson and expect that if the price is much more affordable at this moment, people want to have a home." She also said developers were keen to get rid of their new units and were offering good incentives in the first-hand market.
