CK ASSET (01113) Executive Director Zhao Guoxiong: It is expected that the Hong Kong property market will mainly focus on "de-stocking" this year.

For the property market in 2025, CK ASSET (01113) Executive Director Zhao Guoxiong believes that the current interest rates for housing are still high, and there is no special incentive to encourage residents to buy instead of renting. He predicts that the Hong Kong real estate market will focus on "clearing inventory" this year, with developers hoping to cash out first and prepare for future development. He believes that property prices have bottomed out, but due to oversupply, property prices are expected to fluctuate narrowly throughout the year. It is reported that the Hong Kong property market is in a downturn, with a significant decrease in demand for land in the market. The Hong Kong government has repeatedly failed to sell land, resulting in a 10-year low in land sale revenue, exacerbating fiscal pressure. In this context, the Hong Kong real estate industry has called for the reinstatement of the dormant land resumption system as a possible solution to the problem of failed land auctions. Zhao Guoxiong stated that the market sense of developers may sometimes be better than the government's. If the land resumption system (a land leasing method aimed at communicating specific conditions and prices of land plots in advance to avoid the risk of land auctions) and land sale system operate in parallel, developers can proactively propose to the government when they see the potential of the land, making the land sales system more flexible. Zhao Guoxiong pointed out that Hong Kong's public finances have historically relied on land sale revenue, but the real estate industry is sensitive to economic changes. When the economy is not doing well, it is difficult for the real estate industry to thrive, so it is important to explore new areas of development. He believes that Hong Kong has the capability, talent, and funds to transition to new fields of economic development in the future, which would be better than relying solely on real estate development. However, both Hong Kong Financial Secretary Paul Chan Mo-po and Hong Kong Development Bureau Director Ben Hanhao have rejected the proposal put forward by developers to reinstate the land resumption system. Paul Chan Mo-po has stated that he hopes the government retains the initiative in land sales every quarter, deciding on "how much to sell, how to sell, and which lands to choose," as this approach is more in line with societal needs and public interests.