Hong Kong property investors buck Asia-Pacific buying shift, survey shows

Hong Kong's property market remains resilient amidst a broader trend of selling across the Asia-Pacific region, according to a CBRE survey. Three-quarters of professionals surveyed reported stronger buying intentions from clients in the third quarter, up from 71% in the first quarter. This stands in contrast to the rest of Asia-Pacific, where 35% reported stronger selling intentions, up from 21% in the first quarter.

The survey of 128 professionals suggests that selling pressure is concentrated among institutional investors, while private investors continue to drive most of the buying interest. The rising cost of borrowing is a growing concern, even as most respondents described lending conditions as fairly easy or very easy. Hong Kong and South Korea are among the markets facing more difficult financing conditions, with project financing risks and negative spreads between property yields and borrowing costs weighing on lending in Hong Kong.

Despite the more cautious mood, the market sentiment remains positive, with 68% of respondents citing potential interest rate increases as a major challenge. Investment activity in Asia-Pacific commercial property reached US$54.3 billion in the third quarter, down 13% from a year earlier but above the US$51.3 billion recorded in the previous quarter.

Cross-border and institutional investors remained active, with Singapore investors accounting for a significant portion of non-local and mainland Chinese investment in Hong Kong's commercial property market.