Joseph Tsang, Chairman of JLL in Hong Kong, commented that the local property market is grappling between bulls and bears, leading to unclear price trends. Positive factors included declining HIBOR, rising stock markets, and reduced stamp duty for properties valued between HKD3 million and HKD4 million.

However, headwinds such as geopolitical uncertainties, negative equity reaching a 22-year high, new developments launched at discounts of 30% or more and a potential commercial property crisis pose major headwinds, Tsang said.

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Over the next six months, property developers will need to continue offering discounts on new projects to maintain sales momentum. If the market expects HIBOR to stay below 2% long-term, a low-interest environment could boost residential sales. Propelled by a steady influx of non-local talent and students, residential rents were expected to hit record highs, said Tsang. For property prices, he forecast a 5% decline in small-to-medium-sized residential units this year.

Furthermore, an upswing in distressed commercial property sales is impacting owners of luxury homes, prompting JLL to revise its luxury property capital value forecast from a 5% decline to a 5-10% drop. The Chairman also expected negative equity cases to drift higher, indirectly undermining retail consumption sentiment and market confidence.