Although the China-US trade war slightly eased, the outlook remained uncertain, and it is expected to continue posing challenges to Hong Kong's foreign trade performance, Gary Wan, Principal Economist and Strategist at Dah Sing Financial Group, said.

Benefiting from the temporary reduction of tariffs by both China and the US, Hong Kong's economic growth is forecasted at 2.4% this year. Assuming US tariff levels remain largely unchanged, the HSI is expected to challenge 25,000 in 2H25, with some support around 20,800, and the outlook for high dividend yield, domestic consumption and the innovation & technology sectors being more positive. He also anticipated that the US Fed will cut interest rates twice in 2H25, each by 25 bps.

Hong Kong's mortgage rates significantly fell from peaks, while rental yields gradually picked up, which helped alleviate downward pressure on property prices, Wan added. However, with ample potential supply of primary residential properties, it is unlikely to be quickly absorbed in the short term.

Coupled with the uncertainties brought about by the trade war, it is estimated that property prices may drop by about 5% in 2025.