Hong Kong catching up with Dubai in ‘super-prime’ property sales amid Iran war

Hong Kong has closed the gap with Dubai as the world's leading market for high-end residential properties, according to Knight Frank. While Dubai still leads in number of deals, Hong Kong's value of transactions has significantly narrowed the gap. In the second quarter, Dubai recorded 131 super-prime sales worth $2.17 billion, while Hong Kong had 93 transactions valued at $1.67 billion.

The value of deals in Hong Kong declined by 9%, but this still reduced Dubai's lead by over half, from $1.13 billion to $498 million. The number of transactions in Hong Kong surged 75% year-over-year, whereas Dubai's fell by 8%. Mainland Chinese buyers have played a key role in Hong Kong's property market recovery, focusing on prestigious locations like The Peak.

Despite the broader super-prime market facing challenges globally, with a 7% decrease in transactions and a 6% drop in value compared to the previous quarter, Hong Kong's luxury property market is showing signs of recovery. With property prices in high-demand areas still commanding nine-figure sums, even after discounts, developers are releasing inventory that was previously held during the market downturn.

However, external factors such as Chinese tax changes and capital controls continue to impact the overall market. While banks in Hong Kong have not raised interest rates like the US Federal Reserve, rising rates could still impact the market in the future. Some property owners in prime areas are taking a cautious approach, accepting private offers instead of setting fixed prices.