Hong Kong’s government is urged by market analysts to adopt a cautious approach to land sales as it advances its Northern Metropolis development plan, aiming to sustain the recent upswing in the residential property sector.
Yesterday marked the tender deadline for several land parcels in the Hung Shui Kiu/Ha Tsuen New Development Area, encompassing three residential sites and three plots designated for an enterprise and technology park. Collectively spanning approximately 11 hectares, these sites have the capacity to deliver over 3,100 flats and about 280,000 square metres of industrial floor space.
Eric Tsang, acting head of valuation and advisory services at Colliers Hong Kong, noted that recent land tenders have demonstrated a more realistic supply pace alongside stronger bidding interest. He emphasized that such a measured approach supports price stability and buyer confidence. Tsang advocated for land releases to remain “measured, structured and disciplined,” promoting a steady and sustainable recovery for the residential market.
Derek Chan Hoi-chiu, head of research at Ricacorp Properties, echoed the call for a prudent strategy. He recommended that while the government maintains a projected supply of roughly 98,000 private housing units over the next five years, it should strategically focus land supply around the Northern Metropolis initiative. Chan highlighted that this would help stabilise market expectations regarding medium- to long-term supply and mitigate erratic short-term fluctuations in property prices.
The residential property market has rebounded in recent months following a three-year downturn. Home sales hit a four-year peak of 62,832 units in 2025, according to government Land Registry data, while second-hand home prices rose 3.63 percent last year, as reported by the Rating and Valuation Department. Market momentum has carried into early 2026, with new home sales on pace to reach 12,000 units in the first half of the year, approaching levels last seen in 2019, Midland Realty data shows.
However, the supply of new housing is expected to decline in the near term. Developer completions for private homes dropped 24 percent to 18,448 units in 2025 and are forecasted to fall further to 16,975 in 2026 and 15,362 in 2027, according to the Rating and Valuation Department.
Some market observers caution that the nine plots scheduled for tender this financial year, with potential for around 6,650 flats, may not be sufficient to meet the rising demand. Reeves Yan, executive director and head of capital markets at CBRE Hong Kong, suggested that the government might consider releasing additional residential land to both satisfy demand and boost land sale revenues amid the market’s recovery.