Hong Kong property developers are poised to report stronger first-half earnings in 2026, driven by a significant rebound in home sales and improved development margins, according to recent market analysis. The expected results have drawn investor attention as they seek to determine the sustainability of the sector’s recovery.
Research from Bank of America Global Research projects an average core net profit growth of 8 percent year on year for Hong Kong developers and conglomerates, excluding New World Development. Analyst Karl Choi of Merrill Lynch (Hong Kong) highlighted factors such as a robust recovery in depository participation margins, an early rebound in rental earnings, and a favorable foreign exchange environment, with the Hong Kong dollar appreciating about 6 percent compared to last year.
This anticipated earnings growth follows Hong Kong’s residential property market achieving its strongest first-half performance in over 20 years. Citi Research reported a 34 percent year-on-year increase in new-home registrations, totaling around 12,500 units—the highest first-half figure since 2004. Secondary home sales also rose sharply, with a 43 percent increase from the previous year, reaching a five-year high. These trends have contributed to an 11 percent rise in home prices in 2026, which analysts say has supported developers’ profit margins and cash flow.
Citi Research expects solid first-half results to offer downside support as the recovery in development margins further materializes, accompanied by stronger cash flow generation and lower leverage, underpinned by robust property sales.
Among individual companies, Bank of America foresees Hyson Development leading earnings growth at 51 percent, boosted by sales from its Bamboo Grove project. Other notable performers include Henderson Land Development with 16 percent growth, CK Hutchison Holdings at 10 percent, and Sun Hung Kai Properties at 8 percent. Investors are also anticipated to focus on dividend announcements, with interim dividend increases expected from Hongkong Land, Swire Properties, Sun Hung Kai Properties, and CK Hutchison.
Citi further noted that developers possessing stronger balance sheets, such as CK Asset Holdings and Sino Land, are positioned to outperform more highly leveraged competitors amid ongoing macroeconomic uncertainties.
In contrast to the residential market’s rebound, the commercial property sector remains mixed. Analysts point to renewed demand in prime districts, while non-core areas continue to face weak leasing activity and limited buyer interest. Oxford Economics described the commercial market as entering a phase of “reset rather than recovery.” Elevated office vacancy rates are expected to maintain pressure on earnings, although retail assets have begun to show signs of stabilization.