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Hong Kong's housing market is anticipated to experience a slowdown in the upcoming months, following its most robust first half in seven years, according to analysts. Private home prices rose by 0.3% in June compared to the previous month, continuing their streak of 13 consecutive monthly gains. The city's home-price index increased by 7.9% in the first half of 2026, marking the strongest first-half growth since 2019, although prices remain roughly 19% below their September 2021 peak.

This suggests that most of the year's expected gains have already been realized, with analysts predicting a stabilization of prices rather than further significant increases. Eddie Kwok, executive director of valuation and advisory services at CBRE Hong Kong, noted that the market is expected to enter a consolidation phase as earlier gains are absorbed, and price momentum diminishes.

The consultancy forecasts a growth range of 5% to 10% for Hong Kong residential property prices throughout 2026. Demand remains bolstered by continuous talent inflows and an uptick in non-local students. However, the recent decline in Hong Kong's stock market, coupled with stricter capital controls imposed by Beijing and Beijing's tighter scrutiny of outbound investment, may dampen buying sentiment and investment demand, especially as mainland capital flows into the city's housing market.

Derek Chan, head of research at Ricacorp Realty, suggested that the recent slowdown in monthly price gains in June can be attributed to changing market conditions following a strong performance earlier in the year. The market was active in late May, with healthy transaction volumes in both primary and secondary sectors. Nevertheless, sentiment deteriorated in June due to geopolitical tensions, falling stocks, and concerns over interest rates.

The rental market is currently outpacing the housing market, with residential rents increasing by 0.9% in June from May, the fastest monthly rise in 10 months. This growth reflects sustained demand driven by ongoing talent inflows and a rising number of non-local students. CBRE projects a 5% to 8% annual increase in residential rents, as leasing activity intensifies during the summer peak season.