Core Viewpoint - Citigroup has raised its forecast for Hong Kong's property price increase in 2026 from 3% to 8%, following an unexpected rise of 4.7% in 2025, and anticipates further acceleration in property prices by 2027 [1] Group 1: Market Conditions - The supply of new land is at its lowest level in 14 years, falling below sales volume [1] - The available supply within a year has decreased by 10,000 units [1] - From 2026, new property sales are expected to turn into net growth for the first time since 2019, with an anticipated 21,000 units sold [1] - The completion volume is expected to decline over the next 2-3 years, with an estimated 20,000 units in 2026 [1] Group 2: Demand Factors - The number of non-local student visa approvals in Hong Kong is projected to increase by 10,000 per year, reaching 90,000 [1] - Talent inflow is expected to reach 160,000, compared to 180,000 in 2023/2024 [1] - These factors are expected to boost the rental market and future demand in Hong Kong [1] Group 3: Price and Yield Projections - Cumulative property price growth in Hong Kong from 2023 to 2025 is expected to reach 20%, with a 6% increase in 2025 alone [1] - Gross rental yield is projected to reach 3.5%, with properties under 70 square meters achieving breakeven [1] - The Hang Seng Index typically leads property prices by approximately three months due to the wealth effect from capital markets [1]