Hong Kong Stock Market | Hong Kong Property Stocks Plunge Across the Board, HSBC Plans to Raise H Share Lock-up Interest Rate, Hong Kong Property Market May Face Further Challenges

According to Dolphin Research APP, Hong Kong property stocks plummeted across the board in early trading. As of the time of writing, Sun Hung Kai Properties (00016) fell 10.65% to HKD 78.9, Henderson Land Development (00012) fell 4.73% to HKD 20.15, and Cheung Kong Property Holdings (01113) fell 2.17% to HKD 4065.

In terms of news, it has been reported that HSBC will raise the upper limit of the interest rate for its new mortgage plan (Plan H) starting this month. The current maximum interest rate will increase significantly from 3.625% to 4.125%, while cash rebates will also be greatly reduced. In response to this, Bu Shaoming, Executive Director of Residential Department at Colliers International, said that the implementation of the new policy may make some potential buyers hesitate and dampen their willingness to "buy on dips" when property prices have been falling in recent months. This could further worsen the already sluggish property market sentiment. However, the real impact on transaction volume depends on whether other banks will follow suit in raising interest rates, which may only become clear after the Federal Reserve announces its interest rate decision this month.

Bu Shaoming pointed out that increasing the upper limit of the interest rate is equivalent to a direct interest rate hike, which will not only increase monthly payments but also raise the monthly income requirement for stress testing. In the short term, it may stimulate some potential buyers who have already found their desired properties to expedite their decision-making process and take advantage of the current mortgage policy before it changes, in order to avoid the upcoming higher payments and income requirements.