Hong Kong Home Prices to Accelerate This Year, JPMorgan Says

(Bloomberg) -- Hong Kong's home prices are expected to accelerate this year on steady local demand, shrugging off a wave of omicron variant infections that's set to make viewings more difficult, according to JPMorgan Chase & Co.

Residential property values will rise by as much as 10% in 2022 thanks to the solid domestic demand for homes in the city, Cusson Leung, head of Asia property research at the bank told reporters Thursday.  

Hong Kong's home prices, among the world's most expensive, rose 3.6% in 2021 from the year before, according to Centaline Property Agency Ltd.

The recent emergence of locally infected omicron cases and strict social distancing measures by the Hong Kong government won't tame prices, Leung said. 

“It probably won't affect much on the residential price forecast,” Leung said. “Covid was there in 2020 and 2021.” 

Hong Kong is set to impose strict new virus control measures for the first time in almost a year including halting certain inbound flights and closing bars to prevent a winter wave.

Leung also brushed off the impact from potential interest rate increases on Hong Kong's property prices, saying that the mortgage rate in the city will remain affordable to home buyers given its current low base of around 1.3% to 1.4%.

©2022 Bloomberg L.P.