Goldman Sachs: Raises its forecast for Hong Kong's property price growth to 15% this year, expects a 10% increase in Central office rental prices.

Goldman Sachs released a research report stating that due to the stronger-than-expected trends in property prices/rent in Hong Kong this year, they have once again raised their forecasts. They now predict that residential building prices will increase by 15% compared to the previous forecast of 12% for this year. The forecasted growth rates for 2027 and 2028 remain unchanged at 7% and 4% respectively. For office buildings, Goldman Sachs has raised their rental growth forecast for 2026 from flat to 3%, and has significantly increased the rental forecast for Central office buildings from 3% to 10%, as the rents have already increased by 5% from the beginning of the year. Rents in other areas are expected to remain relatively stable compared to the previous year. In terms of stocks, Goldman Sachs remains bullish on developers, especially those with more sellable assets to profit from the current upward cycle, such as Henderson Land (00012) and SHK PPT (00016), both rated as "buy". They also favor developers with strong balance sheets and intentions to replenish land reserves to take advantage of lower land prices, such as Sino Land (00083). The bank also recommends select REITs that are more inclined to invest in two sectors that they view favorably: core area office buildings and high-end retail, such as Hongkong Land and Swire Properties (01972).