By Keshia Hannam
November 27, 2017

Mass-market home prices are set to rise 8 to 10% next year in Hong Kong, according to property consultancy Colliers International Group Inc.

Throughout 2017 Hong Kong’s government has tried to rein in the world’s most expensive housing market by way of taxes and mortgage curbs to little success. Prices in the city have increased 11%, according to Bloomberg, and the unexpected growth has placed the city in bubble risk territory, as per the UBS Global Real Estate Bubble Index. Tight supply, cheap money, and the Bank of Mom and Dad are all routinely cited as big factors behind the rally.

Read: Inside Hong Kong’s 50 Sq. Ft. ‘Coffin Cubicle’ Homes

Bloomberg also points to assertive bids by developers from mainland China who are eager to build up land banks as another reason. A new crackdown on the mainland’s vast ‘shadow banking’ market is threatening to cut off some avenues of investment, raising the pressure to get some deals done quickly.

Real estate consultant Knight Frank LLP expects home prices to increase 5% and luxury housing to rise 8% in 2018. The housing market has defied predictions of a slowdown in recent months as money from investors has flowed, with buyers setting record prices for everything from luxury homes in the exclusive Peak neighborhood, undeveloped residential land, and major deals for downtown commercial property, according to Bloomberg.

Read: China’s Wanda Group Denies Overseas Property Sales But Is ‘Open to Business Opportunities’

“Now it is very hot, because of the hot money rushing in,” said Raymond Ho, deputy senior director of residential development and investment at Savills. “There is more record-breaking coming.”

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