Luxury home rents in Hong Kong are set to increase by up to 6 percent in the second half of the year, marking a turning point in the rental market. The return of expatriates and the government's Top Talent Pass Scheme are contributing to this rise. Prestigious areas like The Peak and the Southern district are expected to see rent increases between 3 and 5 percent due to high demand and limited housing supply. Data shows that the rental index for large homes has already increased by 2.7 percent in the first quarter, indicating a strengthening market for spacious residences. Despite economic contraction last year, the Hong Kong government forecasts moderate growth for this year.
Luxury home rents in Hong Kong have reached a turning point and are expected to increase by up to 6 percent in the second half of the year. This rise is attributed to the return of expatriates, who had temporarily moved to other cities like Singapore due to the Covid-19 pandemic, as well as the government’s Top Talent Pass Scheme.
Agencies expect luxury property rents in prestigious areas such as The Peak and the Southern district to rise between 3 and 5 percent this year. This projection is driven by a combination of frequent leasing activity and limited housing supply in these areas.
Data from the Rating and Valuation Department indicates that the rental index for large homes exceeding 1,077 square feet (100 square meters) has experienced a notable increase. From January to March, the index rose by 2.7 percent, reaching its highest level since July 2022. This supports the notion that the rental market for spacious residences is strengthening.
According to Centaline Property Agency, transactions in areas such as The Peak and the Southern district saw a year-on-year rise of 8.1 percent, totalling 120 transactions in the first quarter. Among these transactions was the rental of a 5,032 square foot house located at 11 Plantation Road, which was leased for HK$580,000 per month in January, as reported by Savills.
According to information provided by Midland Realty, the number of new rental agreements for high-end residences in The Peak and the Southern district reached a peak of 47 in April, marking a six-month high. Midland Realty anticipates that this figure will continue to increase in the future.
Hong Kong’s government, however, has forecast growth of 3.5 to 5.5 per cent this year after the gross domestic product contracted by 3.5 per cent last year.
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