Hong Kong developers defend pricing as housing supply builds

CBRE expects mass-market discounts to narrow even as developers manage a 101,000-unit pipeline and slower second-half sales.

Hong Kong developers are becoming more selective with discounts as housing demand improves, but a large pipeline and uneven buyer appetite will keep pricing decisions closely tied to monthly sales momentum.

Hannah Jeong, Head of Valuation & Advisory Services at CBRE Hong Kong, said the market recovery appears increasingly structural after 13 consecutive months of price growth, supported by liquidity, talent inflows and record-high rents that are pushing more households towards ownership.

“There is something more structural,” Jeong said, whilst acknowledging that pent-up demand from buyers who waited through the previous three-year correction has also supported sales.

CBRE expects residential prices to rise by as much as 10% in 2026, although Jeong expects the second half to enter a consolidation phase rather than continue the first-half pace. She said mainland Chinese policies affecting overseas investment could also slow transaction volumes.

The 101,000-home pipeline is unlikely to hit the market simultaneously. Jeong said supply is closer to 20,000 units annually, whilst first-hand sales reached about 20,500 units in 2025 and around 13,000 in the first half of 2026.

Developers are therefore pacing launches according to market conditions. Around 15,000 units are expected to be completed in 2027, with the remaining pipeline entering gradually.

Discounting is also becoming more targeted. Developers are offering stronger incentives on initial batches, then reducing discounts when subsequent releases perform well.

Mass-market units, particularly smaller homes, may require less price support, whilst luxury projects remain more exposed because of higher transaction costs and large absolute purchase prices.

Jeong said developers may offer deeper discounts for luxury primary sales, but “mass market, we expect that this year and next year the discount will be lesser than previous years.”