The recent property downturn has paradoxically increased the market dominance of Hong Kong’s three biggest developers. An estimated 60 per cent of new residential units this year and next will be delivered by Sun Hung Kai Properties (SHKP), CK Asset Holdings and Henderson Land, up from 40 per cent in the past two years. Meanwhile, mainland developers and smaller local players have steered clear of bidding for residential plots in the city during the downturn.
Such market concentration is concerning and exposes too many of the city’s housing needs to a few leading market players.
Given the interest rate volatility and unpredictable global trade frictions creating an unstable macroeconomic environment, developers and buyers are both more comfortable investing in and buying smaller and more affordable units.
New homes measuring up to 431 sq ft accounted for more than 60 per cent of all residential transactions in the past few months, up from nearly 50 per cent in 2024. A reduced stamp duty from February also helped generate greater buyer interest – a flat rate of HK$100 for homes worth up to HK$4 million, from the previous threshold of HK$3 million.
All three big developers have extensive land banks and may more easily choose strategic locations to adjust to changing market conditions. The trend is to focus on small to medium-sized flats.
For example, SHKP’s Sierra Sea, a 9,700-unit project near Ma On Shan, has briskly sold more than 700 flats – ranging from 301 sq ft to 702 sq ft – in three rounds since April. Priced up to 20 per cent below the cost of existing nearby homes, it is one of Hong Kong’s largest new residential estates since 1999.
