CBRE: Middle East turmoil may lead to capital inflow into Hong Kong, expected to drive property prices up by 3%-5% this year.

The Hong Kong Rating and Valuation Department announced the private residential property price index for February. Kelvin Ko, Executive Director of Valuation and Advisory Services at CBRE Hong Kong, stated that the Middle East geopolitical unrest has temporarily not affected the Hong Kong property market. However, if the situation persists and oil prices continue to rise, leading to inflation and subsequently an increase in interest rates, it will have a negative impact on the Hong Kong property market. After the outbreak of unrest in the Middle East, funds may flow into Hong Kong. Compared to other investment categories, Hong Kong residential properties are relatively stable and are in a phase of recovery or growth. It is believed that Hong Kong residential properties are attractive and will attract more investors into the market. On the other hand, the Hong Kong Interbank Offered Rate (HIBOR) has been continuously declining since the fourth quarter of last year, with a cumulative decrease of over 1%. If HIBOR remains low, the lower borrowing costs will attract more buyers into the Hong Kong residential market and support residential prices. He maintained his prediction that the Hong Kong residential property market will continue to rise in 2026, with a more significant increase than last year, estimated at around 3% to 5%.