Hong Kong Tower opens up a long bull market: breaking historical highs within 5 years, with the longest upward trend lasting up to 7 years

Chen Junwei, Director of Hong Kong and China Real Estate at Citibank Research Department, has given a clear prediction: based on historical trends, the duration of this round of upward cycle in the real estate market will reach 5 to 7 years. The cumulative increase in property prices in the next two years is expected to reach 15%, and the property price index is highly likely to break through the historical peak in August 2021 within 5 years. Currently, it is in the golden window period for entering the market layout.

This judgment is not an isolated viewpoint, but highly consistent with the consensus of market institutions and fundamental trends. Founder of Zhongyuan Group, Shi Yongqing, recently pointed out that the fourth quarter of 2025 has become an important turning point for the Hong Kong real estate market, and in 2026, it will officially enter a period of high prices, with the annual increase in property prices possibly exceeding 10%. From the perspective of market performance, the transaction volume of 35 large housing estates in Hong Kong will increase by over 7% year-on-year in 2025, with nearly 57000 second-hand transactions, a year-on-year increase of 16%. The pattern of both price and volume rising confirms the start of an upward cycle and strengthens Citigroup's judgment on the long-term upward trend.

Long term support: resonance between supply and demand and funding

The 5-7 year upward cycle predicted by Citigroup is supported by the continuous optimization of supply and demand patterns and strong support from the funding side. On the supply side, the new land supply in Hong Kong is at its lowest level in 14 years and lower than the sales volume during the same period. As of September 2025, the available residential supply has decreased by 10000 households within a year, a decrease of 10%. Citigroup predicts that the sales volume of new properties will achieve a net increase of 21000 units for the first time since 2019 in 2026, while the completion volume will continue to decline in the next 2-3 years, with only 20000 units expected in 2026. The widening supply-demand gap provides a foundation for long-term price increases.

The support from both the funding and demand sides is equally strong. The market hopes that the Federal Reserve and the Hong Kong Monetary Authority will continue to cut interest rates, and the decrease in mortgage costs will activate rigid and improvement oriented demand, forming a favorable pattern of "supply equaling rent" and promoting the transformation of renters into the home buying market. At the same time, the influx of talent continues to inject demand momentum into the real estate market. Citigroup expects that the number of non local student visas obtained in Hong Kong will increase to 90000 per year by 2026, with a talent inflow of 160000 people, driving the heating up of the rental market and transmitting it to the buying and selling market. Combined with the wealth effect brought by the rebound of Hong Kong stocks, it further enhances residents' purchasing power and confidence in home ownership.

Clear goal: break through the historical high of 2021 within 5 years

The Central Plains City Leading Index (CCL) in Hong Kong reached a historic high of 191.34 points in August 2021, but has since experienced a correction and decline. The current market recovery trend is clear, with the second-hand private residential price index rising to 297.3 points in November 2025, and the gap from the historical peak is rapidly narrowing. Citigroup believes that with a cumulative increase of 15% over the next two years, combined with steady annual growth in the future, there is sufficient momentum to break through historical highs within five years, and some high-quality properties in core areas may even meet the standards ahead of schedule.

From the perspective of regional performance, the core area has already demonstrated breakthrough momentum. In 2025, there will be a significant increase in the per square foot prices of residential estates in the Mid Levels, Tung Chung, Tseung Kwan O and other areas. The per square foot price of Lei Kan Tak Court in Mid Levels has risen by 9.6% this year, setting a new high for single properties. Chen Haichao, head of the research department of Lijiage Real Estate, pointed out that the core area, due to its strong scarcity and high risk resistance, will become the main force to break through historical highs, while the demand driven properties will appreciate synchronously with the overall market upward trend, forming a pattern of overall upward trend.

Market entry guidance: Grasp the cycle window and focus on core targets

Chen Junwei emphasized that "now is a good time to enter the market and buy properties", with the core logic being that the current market is in the early stage of an upward cycle, prices are still attractive, and there is strong certainty of future growth. For the group in need, mortgage costs continue to decline during the interest rate cut cycle, and early entry into the market can lock in lower financing costs; For investors, it is necessary to focus on targets with long-term potential for appreciation, and give priority to selecting scarce properties in core areas, housing estates along transportation hubs, and small and medium-sized units that meet talent demand. These types of properties are more stable in terms of supply and demand support, and may outperform the market in terms of growth.

It should be noted that although the market outlook is optimistic, it is still necessary to rationally avoid risks. It is recommended to fully evaluate one's repayment ability before entering the market and avoid excessive leverage; At the same time, paying attention to policy developments, the Hong Kong government may use regulatory measures to stabilize market overheating, and it is necessary to adjust its layout strategy in a timely manner. In addition, priority should be given to selecting housing estates with active trading volume and strong liquidity, which facilitates flexible adjustment of asset allocation in the future.