Entering mid-January 2026, sentiment in the Hong Kong property market has warmed significantly, though market focus remains heavily concentrated on the primary sector. Latest data indicates that developers, prioritizing inventory clearance, have widely adopted "stable price, fast volume" strategies or priced units competitively against market rates to capture purchasing power. Driven by this activity, the latest Eva Property Index (EPI) reported 113.47 points, a slight week-on-week increase of 0.01%, barely arresting the recent downward trend. However, regional performance continues the "three declines, one rise" pattern seen last week, reflecting a recovery still dominated by primary supply dynamics.
Regarding regional performance, the secondary markets in Kowloon and the New Territories have come under distinct pressure as developers aggressively offload stock at market-competitive prices, diverting significant purchasing power to the primary market. Sales in Kowloon have been heated, with projects such as ONE PARK PLACE, the Haddon, PAVILIA COLLECTION, and KT Marina receiving strong support. In the New Territories, SIERRA SEA Phase 2A launched a low-price offensive, which, combined with active transactions in the Villa Garda, Grand Seasons, Grand Mayfair, and Novo Land series, further absorbed market liquidity.
Conversely, the Hong Kong Island secondary market outperformed. With a lack of primary inventory transactions in the district—and the Kabitat Tin Hau project raising prices by nearly 8% for its latest batch—buyers were prompted to return to the secondary market to hunt for bargains. This drove prices in the district upward against the general trend, recording a second consecutive week of growth. Looking ahead, developers are expected to maintain competitive pricing to accelerate sales. Short-term property prices are forecast to fluctuate between 107 and 118 points.
In the leasing sector, performance this week was volatile. The latest Eva Rental Index (ERI) recorded 116.93 points, a slight week-on-week decline of 0.02%, reversing last week's gains. The four districts showed a polarized "two up, two down" trend. Analysts attribute the slight correction to seasonal factors, as January is traditionally a slow season for lettings. Despite this, current rent levels are only 1.36% below the historical peak of 118.54 points set in August 2019. Market expectations suggest that the arrival of the traditional peak leasing season after the Lunar New Year, combined with population inflow from various talent schemes and local housing demand, will provide strong momentum for rents to challenge historical highs.
Market Polarization: New Launches Pressurize Kowloon and NT; Hong Kong Island Rises on Supply Shortage
The property market this week continued the pattern of the previous week, with regional indices again showing three declines and one increase. Aggressive pricing strategies by developers in the New Territories and Kowloon left the secondary market out in the cold, while Hong Kong Island stood out as the sole gainer.
Kowloon recorded the most significant decline, with the index falling sharply by 1.46% week-on-week to 110.17 points, marking two consecutive weeks of decline. Intense primary sales competition—with remaining units at ONE PARK PLACE, the Haddon, PAVILIA COLLECTION, Victoria Voyage series and KT Marina being snapped up—forced secondary homeowners to widen negotiation margins to compete, dragging down regional resale prices.
New Territories East also faced pressure, with the index falling 1.16% to 111.06 points. The decline was primarily driven by the "stable price, fast volume" strategy of SIERRA SEA Phase 2A. The recent launch of over 200 units received an enthusiastic response; with a discounted average price per square foot of just $12,413—still lower than regional secondary prices—it aggressively absorbed purchasing power. Coupled with solid sales in the Le Mon, Villa Garda, and Grand Seasons series, secondary absorption weakened further, leading to a sharp price drop.
New Territories West dipped 0.22% to 120.06 points. Active trading in the Grand Mayfair and Novo Land series marginalized secondary listings, limiting owners' bargaining power and causing prices to soften.
In contrast, Hong Kong Island showed resilience, with the index rising 0.87% week-on-week to 101.36 points, achieving two consecutive weeks of growth. Primary inventory sales were supported only by Aruna, while Kabitat Tin Hau effectively raised prices by cutting discounts, and The Central Residence by the Park merely uploaded its brochure in preparation for sales. These factors stimulated buyers to return to the secondary market, bolstering homeowner confidence and driving prices upward.
Outlook: The primary task for developers this year remains inventory clearance. Given the positive macroeconomic sentiment, developers are expected to continue launching remaining stock at market prices. While this helps digest inventory, it may dampen the rate of property price appreciation for the year. The 28Hse Research Department predicts that the short-term price index will fluctuate between 107 and 118 points. The overall trend is expected to be stable with an upward bias, potentially showing a rise in both price and volume, with full-year price growth estimated at 3% to 5%.
Rental Market Sees Seasonal Adjustment; Poised to Break Historic Highs
The local secondary rental market has been volatile recently. The latest Eva Rental Index (ERI) stands at 116.93 points, down 0.02% week-on-week, ending the previous week's rally. This slight correction is believed to be a normal seasonal adjustment associated with the traditional January lull. In terms of the overall trend, rents have risen by a cumulative 0.78% year-to-date. The index is now just 1.36% shy of the August 2019 historical peak (118.54 points), indicating that rents remain near record levels.
Regional rental performance was mixed. New Territories East performed relatively well, rebounding 1.39% week-on-week to 117.71 points, ending a three-week decline and serving as the main support for the broader market. Kowloon also stabilized, rising 1.01% to 123.14 points, marking five consecutive weeks of growth.
Conversely, Hong Kong Island softened, falling 1.14% to 124.45 points, ending its previous uptrend. New Territories West also weakened, dipping 0.14% to 137.87 points, ending a five-week rally and signaling a slowdown in rental absorption for the district this week.
Looking ahead, the market faces interacting factors. With property price adjustments and rising rents, some estates are seeing scenarios where "buying is cheaper than renting." Coupled with a clearer outlook on interest rates, this may prompt financially capable tenants to switch from renting to buying, potentially slowing the pace of rental growth.
However, the fundamentals supporting the rental market remain solid. In addition to the sustained housing demand from incoming talent, the end of the Lunar New Year holidays will herald the traditional peak leasing season. Pent-up demand for upgrading and leasing is expected to be released, injecting new momentum into the market. Furthermore, landlords holding for long-term yields have limited room for negotiation, providing defensive support for rent levels.
Synthesizing these factors, the 28Hse Research Department expects the Eva Rental Index (ERI) to fluctuate between 116 and 120 points in the short term. After digesting seasonal factors, there is a chance to break the historical high within the next two months. In the long run, rents are expected to maintain a stable upward trend throughout 2026, with full-year growth estimated at 2% to 4%.
The above index reflects market conditions from January 9, 2026, to January 15, 2026.
