According to JLL's most recent Hong Kong Residential Sales Market Monitor Report, luxury residential rents in Hong Kong recorded an increase of 1.4% in the second quarter of 2021, the first quarter-on-quarter rise since the third quarter of 2019. Demand for high-end residential properties appeared to return amid the stronger-than-expected economic recovery.

Mid-level apartments recorded the highest rental growth of 2.0% among the major submarkets, largely on the back of limited availability. Lower rents today compared to late 2019 also induced tenants to upgrade to larger-sized units.

“With rents having declined 16% between the third quarter of 2019 and the first quarter of 2021, tenants took advantage of the more affordable rental market to upgrade from medium- to large-sized units. This was reflected in the drop in vacancy rates according to the latest figure from the Rating and Valuation Department,” said Norry Lee, senior director of projects strategy and consultancy department at JLL in Hong Kong.

Expatriates have traditionally been the main source of leasing demand for luxury housing. But much like last year, there were few expatriate arrivals in the first half of 2021 due to travel restrictions.