Hong Kong residential sales fell 40% quarter-on-quarter (QoQ) in Q3 2026, prompting global real estate services firm Cushman & Wakefield to cut its full-year transaction forecast.
The city recorded 13,242 residential transactions between July and September, down 21% from the same period last year. The fall followed the busiest quarter for home sales since Q2 2021, with more than 22,150 transactions recorded between April and June, according to the firm’s July report.
Rating and Valuation Department data cited in the latest review showed that the residential price index declined 0.8% across July and August. It was still 7% higher over the first eight months of the year.
At its third-quarter review on 05 October, Cushman & Wakefield said buyers had become more cautious as the US interest rate outlook changed, stock markets grew more volatile and mainland China tightened cross-border capital controls.
Monthly residential transactions fell to around 4,000 in Q3, compared with an average of more than 7,000 in the preceding quarter. Sales for the first nine months nevertheless totalled 54,052, up 18% on the corresponding period last year.
Full-year home sales forecast reduced
Cushman & Wakefield now expects 67,000-68,000 residential transactions in 2026. In July, it had forecast around 75,000, some 7,000-8,000 more than its latest estimate.
“The slowdown reflects a more cautious stance among homebuyers amid shifting interest rate expectations and heightened external uncertainties,” said Rosanna Tang, deputy managing director and head of research for Hong Kong at Cushman & Wakefield.
Tang said further rate increases, their timing and whether local banks follow suit would affect buyers’ decisions and what they could afford.
The firm also reported fewer enquiries. Its September Verbal Enquiry Index was 35% below its May peak, according to Edgar Lai, senior director of valuation and consultancy services for Hong Kong.
Lai linked the decline to sustained buying over the preceding year, tighter mainland capital controls and the US Federal Reserve’s September rate increase of 0.25 percentage points.
Home prices soften across market segments
Cushman & Wakefield’s own index for small and medium-sized homes fell 0.1% in Q3, but was still up 7.7% since the start of the year.
The firm’s tracking of individual housing estates showed larger declines in some locations. Prices at City One Shatin, its mass-market example, fell 5.7% QoQ. Taikoo Shing, representing the mid-market, recorded a 0.6% fall, while Residence Bel-Air, its luxury-market example, declined 3.8%.
If the Federal Reserve raises rates again in Q4, Cushman & Wakefield expects full-year home-price growth to stay close to 7%, with little further price movement before year-end.
Residential rents continue to rise
Residential rents rose 4.9% over the first eight months of 2026, despite the slowdown in home sales.
Cushman & Wakefield expects rents to finish the year 5-7% higher. Tang said demand from incoming talent, non-local students and people newly arriving in Hong Kong would support that growth.
