Hong Kong buyers should look to invest in secondary markets in the current environment, Colliers International says.

The firm's Flash report: Revisiting the residential market notes that buyer interest in locations such as e Tseung Kwan O, Yuen Long, and Shatin has been "rebooted" in the wake of the government's announcement last month that it will increase the property value cap from the existing HKD4 million (USD371,610) to HKD8 million (USD743,225) for eligible mortgage loans. 

The research also stated while the city’s economy is entering a technical recession in Q3 2019, following the continuing demonstrations which have been affecting investor sentiment, there was enough evidence to suggest the residential property market would be able to weather the storm.

"Historical data suggested that residential price movement has trended closely with GDP growth," the report says.

"However, we believe the residential sector will stay resilient during this market downcycle, on the back of strong end-user demand, the low interest rate environment, and the prolonged supply shortage.

"We recommend buyers look at popular secondary projects as market liquidity should increase due to the new housing policies allowing a higher loan-to-value ratio.

"Developers should offer competitive prices and other support to buyers to stay competitive amid the warming secondary market."

Click here to view the full report.

Similar to this: 

Secondary Asian cities 'creep back' into top ten of Knight Frank Prime Global Cities Index

Opportunity areas remain amidst geopolitical and economic uncertainties in Asia

Freehold serviced apartment building in Singapore with development potential