Central Plains Real Estate's Chen Yongjie: The government's reduction of intervention in the property market is a good strategy, expects this year's luxury home transaction volume to continue to reach new highs

Chen Yongjie, Vice Chairman of Central China Real Estate for the Asia-Pacific region and President of the Residential Department, stated that the pace of Hong Kong's economic recovery is ideal, with both stocks and property prices rising. The government's reduction of intervention in the property market and allowing it to develop freely is a good strategy. This time, only super luxury properties are being targeted, which has a minor impact on the overall property market and also presents an opportunity to increase tax revenue.

The new fiscal budget proposal suggests that the stamp duty rate on residential property transactions over HKD 100 million will be raised from 4.25% to 6.5%, affecting about 0.3% of residential property transactions, and is estimated to increase annual revenue by about HKD 1 billion.

Chen Yongjie pointed out that the government has realized that transactions of luxury properties are heating up, but in fact, the number of transactions over HKD 100 million has accounted for less than 1% of Hong Kong's overall private residential transactions for many years, and the supply is scarce, belonging to the top-tier properties, where buyers are either wealthy or affluent. Even with this increase in stamp duty on properties over HKD 100 million, the impact on buyers of such properties and the overall property market in Hong Kong will be minimal. Given the favorable market conditions and the rarity of top luxury property supply, it is expected that owners of properties over HKD 100 million will not reduce prices to sell their luxury holdings due to the increase in stamp duty.

Chen Yongjie anticipates that with favorable factors such as declining interest rates, a positive economic recovery, and an increase in companies listing in Hong Kong, the wealth effect will continue to drive demand for super luxury properties over HKD 100 million, and it is expected that the transaction volume of such properties will reach new highs in 2026