HONG KONG — Hong Kong private home prices climbed 0.54% in April from March, marking four months of increases, although the rise was the lowest over that period and the outlook could see more pressure due to macroeconomic uncertainties at home and abroad.
The slight rise in home prices last month in the financial hub, ranked by survey company Demographia as the least affordable city in the world for a thirteenth consecutive year, followed a revised 1.6% gain in March, official data showed on Monday.
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Realtors said the property market could see a correction as buyers turned more conservative after major banks in the city including HSBC and Bank of China Hong Kong raised their best lending rate by 12.5 basis points early this month.
The move followed a hike by the U.S. Federal Reserve. The last such action by Hong Kong banks was in December.
Transaction volume is also expected to continue to soften and fall to a four-month low in May after the spike in the beginning of 2023, which was helped by the reopening of borders with mainland China and many new launches by property developers.
The city’s de facto central bank has warned people should carefully assess the interest rate risk with mortgages and other borrowing decisions, because Hong Kong interbank rates, which have been rising over the past few months, would likely rise further.
Hong Kong’s monetary policy moves in lock-step with the United States as the city’s currency is pegged to the U.S. dollar in a tight range.
(Reporting by Joyo Leung and Clare Jim; Editing by Anne Marie Roantree and Simon Cameron-Moore)
