HK budget pivots to tech and talent amidst commercial property stagnation
Property impact is indirect, the firm says.
CBRE said Hong Kong’s 2026-27 Budget does not directly stimulate the commercial property market, but initiatives to enhance financial competitiveness and promote technology and innovation may still support demand.
The consultancy said the decision to withhold general commercial land sales for a second year is appropriate, given high vacancy rates in some property sectors.
Marcos Chan, head of research at CBRE Hong Kong, said the Budget’s investments and initiatives are intended to speed up economic transformation and lift competitiveness, whilst attracting global and Mainland enterprises and talent.
Chan cited the government’s GDP growth projection of 2.5% to 3.5% for 2026 and said expected interest rate cuts and rising home prices could increase property investment demand.
On policy risks for the luxury segment, CBRE said the proposed rise in stamp duty to 6.5% for transactions above $100m may lead to more company transfers and would mainly affect the primary sales market.
Meanwhile, Joseph Tsang, chairman of JLL in Hong Kong, said the measure could trigger a sharp short-term decline in transactions, with the market likely to take six to seven months to absorb the change before activity recovers.
According to Tsang, 122 luxury home transactions valued at $100m or above were recorded last year, the highest level since 2022.
“As such transactions account for only a tiny portion of the overall market, the government’s move to raise stamp duty on luxury homes priced at $100m or above is unlikely to meaningfully boost revenue,” he added.
Hannah Jeong, head of valuation and advisory services at CBRE Hong Kong, said the creation of two dedicated companies for San Tin Technopole and Hung Shui Kiu Industry Park marks a structural shift in how industrial land is delivered, but warned of overlap risks with existing bodies such as HKSTP and said effective coordination and policy clarity will be critical.
Separately, Fiona Ngan, Head of Occupier Services at Colliers, agreed with the decision to continue withholding commercial land sales in the coming financial year.
“Although market sentiment saw a recovery last year and the leasing market returned to activity, the overall vacancy rate for Grade A office space remains high at 17.5%, with a total vacant area approaching 15 million square feet,” Ngan said.
On the residential market, Colliers’ senior director of valuation and advisory services, Alvin Leung, said that the budget reflects a constructive stance from the government, indicating that medium-term supply remains stable and helping to support overall market confidence.
He added that home prices are expected to rise by about 3% to 5% this year.
Alex Barnes, managing director for JLL Hong Kong, said the decision not to release commercial sites gives the office sector more time to absorb existing supply and stabilise. He said leasing absorption has improved since last year, with vacancy rates in some submarkets starting to decline.
“Grade A office rents in Central have bottomed out and are expected to rise by 0–5% this year,” Barnes added.
Alkan Au, head of value and risk advisory at JLL, said the government appears to be adopting a cautious approach to land supply to avoid putting pressure on the housing market.
“If the government launches more sites after the market has further recovered in the coming years, it could help the government secure higher land revenue,” Au added.
