HONG KONG – Hong Kong’s new home sales may surge by 50 per cent in 2023, after the reopening of the border with mainland China and as interest rate increases end.

The view of Bloomberg Intelligence is that sales of new residential projects in the city could jump 50 per cent to HK$175 billion (S$29.6 billion) in 2023, from a nine-year low in 2022.

Bloomberg Intelligence forecasts HSBC Holdings’ prime rate – the city’s lending benchmark – to peak at 7 per cent in 2023 on expectations that the United States Federal Reserve may slow the pace of tightening.

Property developers are already saying that they are seeing homes being sold at an accelerated pace in recent weeks.

On Monday, Wheelock Properties (Hong Kong) managing director Ricky Wong said transactions were also being made at a faster rate in the past week amid more appointments to see apartments, alongside a significant increase in inquiries.

“The bad news is in the past,” Mr Wong said.

As at Tuesday, Henderson Land Development has sold 101 units in January for more than HK$475 million in its One Innovale – Cabanna project, according to the company.

Hong Kong’s real estate companies were cautious about putting projects up for sale in 2022 as home prices retreated. The city recorded about 10,000 new home transactions in 2022, the lowest since 2013, while property values declined more than 15 per cent.

After a population exodus in the past couple of years, there is evidence recent government policies of attracting talent to the city has lifted confidence in the market and that housing demand from the newcomers could fill the gap left by those who emigrated. BLOOMBERG