"HK Property" Meridian: Last quarter, negative assets fell to 21,300 cases, hitting a nearly nine-quarter low, still with room for further decline

According to the latest data released by the Monetary Authority, there were 21,304 cases of negative equity recorded in the fourth quarter of 2025, involving an amount of HKD 105.434 billion. Compared to the 31,449 cases and HKD 156.758 billion recorded in the third quarter of 2025, the number of cases and the amount decreased by 32.3% and 32.7% quarter-on-quarter, reaching a new low in nearly nine quarters.

Cao Deming, Chief Vice President of the Mortgage Referral Division, stated that the property market is warming up, and property prices continue to stabilize. According to the information from the Rating and Valuation Department, the private residential price index in Hong Kong has risen for seven consecutive months. Additionally, according to data from Hong Kong Mortgage Corporation Limited, the number and amount of new mortgage insurance loans for the entire year last year were 7,098 cases and HKD 35.188 billion, representing a decrease of 24% and 26.5% compared to the entire year of 2024, with the number of cases reaching a new low for the past decade and the amount reaching a new low for the past six years. Given the rise in property prices, the number of buyers opting for higher mortgage ratios has significantly decreased, leading to a quarter-on-quarter decline in negative equity cases.

Cao Deming pointed out that the interest rates have fallen to a reasonable level, which is beneficial for further economic recovery and will boost the property market, gradually accelerating the pace of entry for users and investors. Furthermore, some developers have recently raised the prices of their new projects for sale, and it is expected that property prices will fluctuate upwards this year. There is still room for a decline in negative equity cases; if property prices rise by another 10% this year, the number of negative equity cases may fall below 15,000.

Additionally, Cao Deming stated that although the number of negative equity cases remains above 10,000, the repayment ability of homeowners in Hong Kong has remained robust. The delinquency rate for mortgage loans that have not been repaid for more than three months among negative equity cases is 0.31%, which is still a low level, indicating that the vast majority of homeowners' repayment capabilities remain stable. He continued to say that although the economy in Hong Kong continues to grow and consumer sentiment has improved, the operating environment in some industries is still facing challenges. Individuals intending to purchase property should assess their own economic and repayment capabilities, avoid borrowing too much relative to their income, remember to make timely repayments, and reserve at least six months of backup funds for emergencies