Entering the first week of August, property market sentiment remained volatile, with the sales and leasing markets exhibiting diverging trends.
In terms of property prices, the latest Eva Property Index (EPI) stood at 120.79 points, representing a week-on-week decline of 0.84%. This ended the previous week's upward momentum and breached the 121-point level, remaining approximately 17.13% below the historical peak of 145.76 points recorded in August 2021. Property prices across all districts experienced a broad-based decline, primarily dragged down by lackluster sales in the primary market. Notably, the third round of sales for the new project in New Territories West, Garden Regency, sold less than 40% of its available units. Meanwhile, transactions for unsold primary inventory in Kowloon, Hong Kong Island, and New Territories East failed to register any significant breakthroughs. The slowdown in the primary market prompted secondary market owners across various districts to widen their room for negotiation, thereby exerting downward pressure on overall property prices.
Conversely, the leasing market continued its upward trajectory. The Eva Rental Index (ERI) stood at 121.13 points this week, edging up 0.17% week-on-week to mark a three-week consecutive rise. In addition to stabilizing above the 121-point threshold for the first time, the index is also 2.18% higher than the secondary historical peak of 118.54 points recorded in August 2019. Multiple estates across Hong Kong Island, Kowloon, and New Territories West recorded leasing transactions at above-market rates, driving a steady increase in overall rents.
Amidst the traditional summer leasing peak season, rental demand from non-local students remains robust, with many generally willing to pay rent in advance. The market anticipates that this substantial leasing demand will persist until at least September, keeping the short-term rental outlook optimistic. Meanwhile, overall property prices are expected to continue consolidating amid a stalemate in transaction volumes.
Regional Property Prices Decline Across the Board; Kowloon Drops 1.5%
The regional property price indices faced downward pressure across the board this week. Kowloon and the New Territories West recorded declines for two consecutive weeks, reporting 116.82 points and 122.93 points, representing week-on-week drops of 1.5% and 0.7%, respectively. The upward trends in Hong Kong Island and the New Territories East also came to a halt, reporting 110.03 points and 121.24 points, with slight week-on-week decreases of 0.45% and 0.08%, respectively. According to Land Registry data, only 128 primary market transactions were recorded territory-wide, plunging by over 60% week-on-week. The subdued trading volume has prompted secondary market owners to widen their room for negotiation, dragging down property prices across all districts.
Kowloon recorded the most significant drop in property prices, primarily due to the slow absorption of unsold primary market inventory. This week, primary transactions in the district were mainly concentrated in Cullinan Sky Phase 2, which recorded 8 transactions; Victoria Voyage series recorded 5 transactions; while Grand Homm, One Victoria Cove Phase 4, and the KT Marina series each recorded 4 transactions. According to internal statistics from 28Hse in early August, the unsold inventory in Kowloon reached 9,018 units, accounting for nearly half of the city's total and ranking highest in Hong Kong. Under the pressure of massive supply, transaction volumes appeared sparse, leaving owners with no choice but to reduce asking prices. In addition, unstable weekend weather also dragged down property viewing activities. Consolidated data from Midland Realty and Hong Kong Property Services showed that weekend viewing appointments for several large-scale benchmark estates in Kowloon stood at approximately 170 groups, representing a week-on-week decline ranging from 0.5% to 2.2%, reflecting weak purchasing sentiment among prospective buyers.
Despite the quiet market, developers have maintained their pace of project launches. The project at 33 Clear Water Bay Road in Ngau Chi Wan has been officially named 33 Clear Water Bay, with its sales brochure uploaded, while the Sterling I in South West Kowloon is also deploying for launch; both are scheduled for sale in August. Meanwhile, the Pavilia Forest II released a new price list on August 5, adding 75 units with an average discounted price of $25,282 per square foot. Certain units with the same orientation saw an actual price increase of approximately 8% to 9%, indicating developers' continued confidence in the market outlook.
Property prices in the New Territories West were similarly under pressure, largely dragged down by the lackluster sales performance of new primary projects. The highly anticipated project Garden Regency launched its third round of sales, but only sold 42 out of 114 units, representing a sell-through rate of less than 40%. Other unsold inventory in the same district also recorded only sporadic transactions. The slowdown in the primary market has prompted some secondary owners to increase their negotiation margins to attract buyers. According to Midland Realty data, weekend viewing appointments for two major benchmark estates in the New Territories West fell to approximately 98 groups, a slight week-on-week drop of about 1%. The reduction in both viewing and actual transaction activities has exerted downward pressure on the price index.
Market conditions in the New Territories East were largely similar, with the primary market supported solely by 7 transactions from La Mirabelle series. Weekend viewing appointments for benchmark estates in the district saw a slight decline, indicating that prospective buyers are adopting a more cautious approach to entering the market. Observing the weakening market demand, secondary owners have successively lowered their asking prices, leading to a drop in district property prices. However, PARK SILICON in Kwu Tung North is expected to announce its pricing and open its show flats in the short term, which will bring a new focal point to the district's property market.
Regarding the territory-wide decline in property prices this week, May Chu, Managing Director of Love Property Agency Limited, pointed out that there has been a continuous shortage of viewable listings across various districts recently. Many properties listed for sale are currently tenanted, preventing prospective buyers from conducting on-site inspections and causing them to postpone their purchasing decisions. Furthermore, as the market has already absorbed a large batch of high-quality listings earlier, transaction volumes have naturally decreased, ultimately dragging down the overall and regional property prices.
In terms of the macroeconomic environment, the property market is facing considerable external headwinds. The mainland's recent tightening of capital outflows and the requirement for tax residents to pay a 20% personal income tax on their global offshore income have undeniably exerted an increasingly obvious negative impact on market sentiment and transaction volumes. It is anticipated that purchasing power in both the primary and secondary markets will be further weakened in the future.
Overall, Alex Cheung, 28Hse Limited Data Researcher, expects the EPI to fluctuate between 112 and 124 points in the short term. Entering the second half of the year, unfavorable factors in the broader property market are gradually emerging. As expectations for interest rate cuts diminish, property prices may experience a corresponding correction, which is considered to be a natural market adjustment.
Rental Index Rises 0.17% to Mark a Three-Week Winning Streak, Stabilizing Above 121 Points for the First Time
Amid the peak summer leasing season, the ERI has firmly established itself above the 121-point mark for the first time, currently standing at 121.13 points with a slight week-on-week increase of 0.17%. Having recorded gains for three consecutive weeks, the index is now 2.18% higher than its second-highest historical peak of 118.54 points recorded in early August 2019. The rental index is expected to continue its upward trajectory, maintaining strong short-term momentum and potentially breaking its all-time high.
Regional indices registered three gains and one decline. Hong Kong Island recorded the most significant growth, currently standing at 134.53 points. This represents a week-on-week increase of 2.29% and a three-week winning streak, primarily driven by high-yield rental transactions in select housing estates. Notably, a two-bedroom unit (Flat D, top-level floor, Tower 3) at BLUE COAST, with a saleable area of 446 square feet, was leased at a monthly rent of $27,000, translating to $61 per square foot. An open-plan unit (Flat C, mid-level floor, Tower 3) at Novum West, with a saleable area of 195 square feet, was pre-leased to a new tenant for $20,900 per month. The unit rent reached a record high of $107 per square foot since the estate's completion. Additionally, a one-bedroom unit (Flat K, mid-to-high floor) at KENNEDY 38, with a saleable area of 298 square feet, was leased for $26,000, or $87 per square foot. The unit rents for these three transactions surpassed the 28Hse platform's 90-day averages of $59, $82, and $85, respectively. The transaction at Novum West exceeded the average unit rent by over 30%, propelling the significant surge in the Hong Kong Island rental index this week.
The New Territories West index also performed strongly, reporting at 137.89 points. This marks a week-on-week increase of 1.08%, halting a three-week losing streak. The district continued to record high-priced leases of properties near universities by Mainland students arriving for their studies. A two-bedroom unit (Flat B, mid-level floor, Tower 9) at Parkland Villas, with a saleable area of 381 square feet, was jointly leased by two Mainland students from Lingnan University for $13,800 per month. The tenants paid the full rent for the entire lease term in a single lump sum, equating to $37.2 per square foot. Similarly, a two-bedroom unit (Flat B, high-level floor, Tower 1) at NOVO LAND Phase 1B, with a saleable area of 446 square feet, was leased by a Mainland student from Lingnan University at a monthly rent of $15,500 with a one-year upfront payment, translating to $47.5 per square foot. According to 28Hse data, the 90-day average unit rents for these two estates were $36 and $42, respectively, indicating that the aforementioned transactions were significantly above market rates. Such cases of premium pricing coupled with annual upfront payments have driven the New Territories West rental index to rebound, reflecting that the rigid demand during the summer peak season is continuously propelling overall rents upwards.
The Kowloon index rebounded to 125.1 points, up 0.77% week-on-week, as the district continued to record high-priced rental transactions. A three-bedroom unit (Flat D, high-level floor, Block B18) at Village Gardens, with a saleable area of 803 square feet, was leased to an out-of-district family for $36,000 per month, or $45 per square foot, surpassing the platform's concurrent average of $39. A one-bedroom unit (Flat B8, mid-level floor) at Artisan Garden, with a saleable area of 283 square feet, attracted a Mainland tenant who leased it with zero negotiation at approximately $60 per square foot, higher than the recent market average of $59. This indicates that Kowloon's rental market is well-supported by substantial housing demand.
Conversely, the New Territories East index faced downward pressure, reporting at 123.95 points. This represents a week-on-week decline of 0.65%, ending its three-week upward streak, primarily due to certain units being leased below market rates. A two-bedroom unit (Flat B, low-level floor, Tower 6) at Jubilee Garden, with a saleable area of 498 square feet, was leased for $19,000 per month by two Mainland students advancing their studies at the Chinese University of Hong Kong, equating to approximately $38.2 per square foot. According to 28Hse data, this transaction was about 4.5% lower than the concurrent average unit rent, thereby dragging down the rental performance in New Territories East.
Addressing the rental increases across the overall territory, Hong Kong Island, Kowloon, and New Territories West this week, Chu pointed out that the Mainland's policies restricting capital outflows have prompted many Mainland clients to shift from buying to renting, thereby supporting a steady upward trend in rents. With the primary sales market remaining relatively quiet, the leasing market will continue to serve as the main driving force supporting the overall property market.
Driven by the leasing demand from Mainland students, market inventory is expected to remain in short supply, and unit rents in specific housing estates may test new highs. Cheung estimates that the ERI will fluctuate between 114 and 124 points in the short term, with full-year rents rising by approximately 2% to 4%, and the index is poised to continually break historical highs.
The above indices reflect market conditions from July 31, 2026, to August 6, 2026.
