Hong Kong developers see 8% profit jump as home sales hit 22-year high
New-home registrations surged 34% to a 22-year high, lifting prices 11%.
Hong Kong property developers are set to report stronger first-half earnings in the coming weeks, fueled by a robust rebound in home sales and improving development margins. Bank of America Global Research forecasts average core net profit growth of 8% year-on-year for developers and conglomerates (excluding New World Development), according to a July 15 report. The improvement is attributed to a sharp recovery in depository participant margins, an early rental earnings rebound, and a 6% year-on-year appreciation of the yuan, which provided a foreign exchange tailwind.
The residential market delivered its strongest first-half performance in over two decades. Citi Research estimates that new-home registrations rose 34% year-on-year to about 12,500 units, the highest first-half tally since 2004. Secondary home volume climbed 43% year-on-year to a five-year high. These stronger sales lifted home prices by approximately 11% this year, supporting developers' margins and cash flow. However, the commercial real estate sector continues to face headwinds from a lack of demand in non-core areas, tempering the overall optimism for the property sector's sustainability.
- Bank of America expects 8% core net profit growth for Hong Kong developers in H1 2026, excluding New World Development.
- New-home registrations hit 12,500 units (34% YoY increase), the highest first-half figure since 2004.
- Home prices rose 11% this year, while commercial real estate demand remained weak in non-core areas.
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