Stamp duty cut to boost demand in Hong Kong’s lower-end housing

For a $4m property, buyers will now pay $60,000 less in taxes, which could help stimulate demand in the lower-end housing market.

The increase of maximum property value eligible for a $100 stamp duty to $4m from $3m is expected to benefit approximately 15% of property transactions, according to Morgan Stanley.

For a $4m property, buyers will now pay $60,000 less in taxes, a 99% reduction, which could help stimulate demand in the lower-end housing market, Morgan Stanley stated.

Morgan Stanley noted the acceleration of the Northern Metropolis development is a crucial strategy aimed at facilitating faster land resumption from developers such as NWD, Henderson, SHKP, and CKA.

This initiative is expected to support Hong Kong’s long-term urban planning and economic integration with Shenzhen.

However, despite these efforts, land sales remain under pressure. The government is targeting $21b in land sale revenue for FY26, which represents a 55% increase from $13.5b in FY25.

Yet, this figure is significantly lower than the $110b average recorded between FY15-19, reflecting weak market sentiment and a cautious approach from developers.

Morgan Stanley underscores that the success of the Northern Metropolis will depend on effective execution and stronger developer participation.

Whilst accelerating land resumption is a step in the right direction, the current subdued demand for land and investor caution could pose challenges. Without clearer policies and additional demand-side measures, market confidence in the project may remain uncertain.