JPMorgan believes Hong Kong property remains resilient after the Iran conflict and keeps a constructive view

Overview

This report examines whether Hong Kong's residential market has shown any deterioration in sentiment or fundamentals since the Iran conflict broke out in late February 2026. JPMorgan believes that, as of the observation period, the Hong Kong property market has not shown any obvious weakening: prices have continued to rise, and secondary transactions, viewing appointments, and real-estate agency website traffic have not fallen materially. Primary-market first-day sell-through remains healthy, and interest from mainland buyers is still high. The report therefore maintains a constructive view on the Hong Kong residential market.

Core views

The key views are: first, Hong Kong property prices dipped only briefly at the start of the conflict and then rebounded, showing that prices are still supported; second, high-frequency secondary-market indicators are more useful than monthly transaction data for assessing the immediate post-conflict state, and these indicators have remained broadly stable; third, first-day sell-through for primary launches must be interpreted together with project positioning, developer brand, pricing versus the secondary market, and launch size, and a rate below 100% should not be mechanically read as a sign of weakening demand; fourth, a pause in rate hikes remains manageable for Hong Kong property, and even if the market enters a hiking cycle, history shows that does not necessarily lead to a property-price correction; fifth, the real risk to watch is a sharp drop in the Hang Seng Index, because Hong Kong property prices are fairly closely correlated with the stock market.

Analysis framework

The report uses a post-event tracking framework, taking the start of the Iran conflict as the dividing line and combining the Centa-City Leading Index, weekly secondary transactions across 35 major estates, Midland weekend viewing appointments, real-estate agency website traffic, the Centa-Salesman Index, first-day sell-through of primary launches, launch size, pricing versus the secondary market, and the share of mainland buyers to assess whether prices, transactions, sentiment, and demand have deteriorated.

Methodology notes

• Event impact assessmentPost-conflict market resilience tracking

  Use changes in prices, transactions, and sentiment after the Iran conflict began to judge whether the Hong Kong property market is weakening.

  The report explicitly notes that some official and industry data are lagged, so it places greater emphasis on weekly secondary transactions, viewing appointments, and agency website traffic, which reflect market conditions more quickly.

• High-frequency real-estate market monitoringSecondary-market price/volume and sentiment indicators

  Measure market health using the secondary-price index, transactions in major estates, viewing appointments, listing volume, and agent sentiment.

  The price index shows a cumulative gain of 0.8% in the first two weeks of the conflict; weekly transactions across 35 major estates were about 80; weekend viewing appointments for major estates stayed above 500; and the volume of secondary listings has been stable in recent months, with no surge that would pressure prices.

• Primary-market project analysisFirst-day sell-through decomposition

  First-day sell-through in the primary market should be interpreted alongside pricing, project positioning, brand, and launch size.

  The report argues that 100% sell-through is not always a positive sign, because it may indicate underpricing; the 1,116 units launched in the first batch in March were the highest in recent years, and divergent sell-through across projects is reasonable when supply is being released in larger volumes.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Hong Kong residential market

  Research target

  Strengths

  Prices continue to rebound, secondary transactions and viewing appointments are stable, overall primary-market sell-through is healthy, and mainland buyer demand remains elevated.

  Weaknesses

  Some price indices lag by about three weeks, so the conflict's impact is still in an early stage; sell-through differs noticeably across primary-market projects.

  Comparison

  Compared with 2024/2025, when many new launches were sold at discounts to the secondary market, recent projects are being launched at roughly a 10% premium, showing stronger developer confidence.

  Risks

  A prolonged Middle East conflict could lead to higher rates; if the Hang Seng Index drops sharply, wealth effects and sentiment could drag on property prices.

• SHKP

  One of the preferred developer names

  Strengths

  Included among the report's preferred developers and viewed as relatively defensive.

  Weaknesses

  The report summary does not provide separate financial forecasts or a target price.

  Comparison

  Grouped with Sino and CKA as a preferred developer name.

  Risks

  Affected by Hong Kong residential transaction volumes, prices, interest rates, and Hang Seng Index volatility.

• Sino

  One of the preferred developer names

  Strengths

  Included among the report's preferred developers; representative projects such as La Mirabelle still achieved 100% first-day sell-through.

  Weaknesses

  The report summary does not disclose company-level earnings sensitivity.

  Comparison

  Grouped with SHKP and CKA as a preferred developer name.

  Risks

  If the new-launch premium strategy cannot be sustained, margins and sell-through speed may come under pressure.

• CKA

  One of the preferred developer names

  Strengths

  Included among the report's preferred developers and positioned defensively.

  Weaknesses

  The report summary does not provide company-level valuation details.

  Comparison

  Grouped with SHKP and Sino as a preferred developer name.

  Risks

  Changes in Hong Kong property prices, transaction volumes, and financing costs may affect performance.

• Swire Prop

  One of the preferred rental-property names

  Strengths

  Included among the report's preferred rental-property names and has relatively defensive characteristics.

  Weaknesses

  The report summary does not discuss rents, occupancy, or segment performance.

  Comparison

  Grouped with HKL as a preferred rental-property name.

  Risks

  Higher rates and a weaker stock market could weigh on property-sector valuations.

• HKL

  One of the preferred rental-property names

  Strengths

  Included among the report's preferred rental-property names and suitable for defensive allocation.

  Weaknesses

  The report summary does not provide a separate target price or earnings forecast.

  Comparison

  Grouped with Swire Prop as a preferred rental-property name.

  Risks

  Lower market risk appetite, rate changes, and volatility in Hong Kong asset prices could affect valuation.

Key data

• Hong Kong residential price performance after the conflict+0.8%The Centa-City Leading Index showed a 0.1% decline in the first week of the Iran conflict, a 0.9% rebound in the second week, and a cumulative 0.8% gain over the first two weeks.
• YTD rebound in Hong Kong residential pricesClose to +6%The report says Hong Kong residential prices have rebounded by nearly 6% year to date, leaving about 4 percentage points of room versus the low end of the full-year forecast range of 10% to 15%.
• Rebound since the March 2025 troughClose to +13%Prices have rebounded nearly 13% from the March 2025 low.
• Weekly secondary-market transactions in 35 major estatesAbout 80 dealsIn recent weeks, weekly transactions have been around 80 deals, in line with levels since Q4 2024.
• Weekend viewing appointments for major estates>500 dealsWeekend viewing appointments for 15 major estates tracked by Midland have stayed elevated in recent weeks.
• Overall first-day sell-through of March new projects after the conflict85%The report tracked eight primary-market launches after the conflict in March, with an overall first-day sell-through rate of 85%.
• March first-batch launch units1,116 unitsThe report says this was a recent high, compared with fewer than 500 units per month in the past.
• Mainland buyer sharePrimary market 53%; secondary market 24%The report says mainland buyer interest remains high, accounting by value for 53% of the primary market and 24% of the secondary market at present.
• Pricing of recent new launches versus secondary-market projectsAverage premium of about 10%Unlike in 2024/2025, when most projects were sold at a discount of less than 10% to comparable secondary-market homes, recent developer pricing has been more aggressive.

Impact & implications

If the report's view is correct, the short-term trading logic for Hong Kong property stocks should not simply turn bearish because of geopolitical conflict; market resilience and developer pricing confidence may support a valuation recovery for the sector. That said, portfolio positioning should still favor more defensive developers and rental-property names, while closely monitoring equity-market and rate shocks.

Risks

• A sharp drop in the Hang Seng Index is the report's biggest sector risk, because Hong Kong property prices are strongly correlated with the stock market.
• If the Middle East conflict lasts longer, it could create upward pressure on rates; although the report believes a pause in rates is currently manageable, higher rates would still affect sentiment and valuation.
• Some transaction and price data lag by several weeks, which may understate the latest post-conflict changes.
• If secondary listings suddenly rise, they could put downward pressure on residential prices.
• If the primary market slows in the face of high supply and premium pricing, developer confidence may weaken.

What to watch

• Future readings of the Centa-City Leading Index, especially price data that extends further beyond the conflict period.
• Whether weekly secondary transactions across 35 major estates remain around the 80-deal level.
• Whether weekend viewing appointments for major estates tracked by Midland stay above 500.
• Whether the Centa-Salesman Index eases from elevated levels.
• Whether secondary listings rise materially.
• Changes in first-day sell-through, launch size, and pricing premiums versus the secondary market for new launches.
• Whether the mainland-buyer share in the primary and secondary markets stays elevated.
• The path of the Hang Seng Index and its transmission to property sentiment.
• The duration of the Middle East conflict, the interest-rate path, and changes in Hong Kong mortgage affordability.