Mainland Chinese buyers snapped up 5,777 Hong Kong homes in the first four months of 2026 – already equal to more than 41 per cent of last year’s total transactions – as demand accelerated on the back of aggressive new home launches, rising rents and expectations of further yuan appreciation.
The pace of buying picked up sharply in April, when mainland Chinese registrations rose nearly 48 per cent month on month to 1,892 deals, the highest level in two years. Transaction value climbed nearly 31 per cent to HK$18.9 billion (US$2.4 billion), a 17-month high.
The value of purchases in the first four months reached HK$61.6 billion, equal to 45 per cent of last year’s HK$137.9 billion total, according to data compiled by Midland Realty from Land Registry records.
The figures were based on the use of Putonghua pinyin names in official records, though some buyers may hold Hong Kong permanent residency.
Vicky, a mainland buyer who came to Hong Kong to study for a master’s degree and declined to give her full name, said she had been looking at homes for two years before deciding to buy a flat at Highwood Phase II at 70 To Kwa Wan Road, which launched last week.
“With the current exchange rate, buying in [yuan] is effectively like getting about a 13 per cent discount,” she said. “The price-to-rent ratio is also attractive.”
Currency expectations also reinforced buying momentum. The yuan has been grinding higher this year, supported by China’s robust exports and trade surplus. It has gained about 2.6 per cent against the US dollar this year, with the onshore yuan touching 6.84 per dollar on Friday, its strongest level in three years.
Because the Hong Kong dollar is pegged to the US dollar, any yuan appreciation directly improves mainland buyers’ purchasing power for Hong Kong assets.
Goldman Sachs said in a recent report that the yuan remained more than 20 per cent undervalued against the US dollar based on its valuation models, despite recent gains.
The bank argued that China’s growing external surplus and export competitiveness supported a “gradual but sustained” strengthening trend, forecasting the exchange rate at 6.50 within 12 months.
Mainland buyers showed a clear preference for the primary market, where purchases almost doubled to 1,032 transactions in April from 527 in March. By contrast, secondary-home purchases rose a more moderate 14 per cent to 860 deals.
Hong Kong’s Centa-City Leading Index, compiled by major agency Centaline, rose 7.7 per cent this year through March, reflecting stronger sentiment.
Investors also returned, encouraged by the removal of extra stamp duties, improving rental yields and lower financing costs. In some cases, developers recorded bulk purchases worth hundreds of millions of Hong Kong dollars, with investors acquiring multiple flats in a single transaction for rental and investment purposes.
Projects near transport infrastructure and in large-scale residential districts proved particularly popular. The most sought-after developments among mainland buyers in April included Zendo House in Tsim Sha Tsui and La Mirabelle in Lohas Park, which recorded 95 and 92 transactions respectively, according to Midland.
Benny Sham, analyst at Midland, said the current acceleration appeared to be supported by a broader combination of structural and financial factors, including stronger rental economics, sustained primary-market demand, yuan appreciation expectations and a growing base of mainland professionals living and working in Hong Kong.
Morgan Stanley said strong absorption rates suggested demand had become more sustainable than during earlier rebounds. The bank said sell-through rates for new launches had been close to 100 per cent, allowing developers to raise prices in subsequent batches after strong initial demand.
That earlier rally was driven largely by pent-up demand after the removal of extra stamp duties on non-local buyers.
In April 2024, Mainland registrations surged to 2,358, but later fell sharply as high interest rates, weak local sentiment and concerns about declining home prices weighed on the market.
This year’s recovery, however, developed from a much higher baseline. Mainland buyer registrations have now remained above 1,000 for 14 consecutive months, the longest streak since records began in 2010. -- SOUTH CHINA MORNING POST
