Hong Kong, 27 Mar 2023 The frenzied scramble for rented property has been one of the most conspicuous effects of the easing of pandemic-related restrictions. The sudden resumption of demand has added to the long list of factors driving up rental prices. Among the most important ones are the lack of supply, the “financialisation” of real estate and, more recently, the surge in mortgage rates.
urthermore, a ramp-up in supply this year is expected to help moderate the pace of rental growth. Completions of new private properties (excluding executive condominiums) are forecast to rise to more than 18,000 units this year, up from just 3,433 in 2020 and 6,388 in 2021, data from OrangeTee & Tie shows.
The bulk of the new supply, moreover, is in suburban and fringe locations, where rental growth has been the sharpest. Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, expects the pace of growth to slow this year to 13-16 per cent.
Although still difficult for tenants to stomach, there is little indication that the boom is causing foreigners to leave in droves. “They will pay up or move to cheaper locations,” Sun said.