Buy or rent? Hong Kong homebuyers face an age-old housing dilemma

Hong Kong homebuyers must face the age-old challenge of choosing between buying a property or renting one. Rising residential rents and potential interest rate hikes have led many to reconsider the decision. The Centa-City Rental Index (CRI) has increased by 5.2% to 136.34 in July 2026 from 129.57 at the beginning of the year. Jimmy Lau, an IT professional, decided to buy a 474 sq ft unit for HK$9,873 per square foot after his lease was about to expire, as rents had risen significantly.

His monthly mortgage payment is now less than the rent for a similar unit. Ivan Wong, a sales manager, noted that rents have risen by nearly 10% recently, while asking prices for flats have dropped by 3 to 5%. Many tenants are considering purchasing instead of renting, hoping to find a bargain. The summer holidays are the peak rental season, with high transaction volumes and rising rents.

However, some homeowners like Chan, a teacher, continue to rent their units despite rent increases due to uncertainty in the property market and economy. While buying a home could be cheaper than renting, many potential buyers are hesitant due to anticipated interest rate increases and slow transaction activity. Despite potential price drops, major banks continue to offer fixed-rate mortgage plans to help homebuyers manage the risk of rising interest rates.