Hong Kong Sees Rise in Mortgage Applications in May 2025

Mortgage Applications Surge in May

The Hong Kong Monetary Authority (HKMA) has released the results of its residential mortgage survey for May 2025, indicating a notable uptick in mortgage activity. According to the HKMA, the number of mortgage applications increased by 5% month-on-month, reaching a total of 8,187 applications. This rise in applications reflects a growing interest in the housing market amid changing economic conditions.

Mortgage Loans Approval and Market Dynamics

In May, the total value of mortgage loans approved climbed by 5.3% compared to April, amounting to HK$26.6 billion. Notably, the sector experienced divergent trends within its market segments. While loans for primary market transactions declined by 4.2% to HK$8.9 billion, secondary market transactions saw a 7.1% increase, totaling HK$14.6 billion. Additionally, mortgage loans for refinancing surged significantly by 33.7% to HK$3 billion.

Drawdowns and Pricing Trends

Despite the overall rise in approvals, the mortgage loans drawn down during May decreased by 5.3% from April, totaling HK$16.2 billion. The HKMA noted a shift in pricing preferences among borrowers. The proportion of new mortgage loans priced with reference to the Hong Kong Interbank Offered Rate (HIBOR) increased from 91.8% in April to 93.4% in May. Conversely, the share of loans priced against best lending rates decreased from 2.3% to 1.9% during the same period.

Outstanding Mortgage Loans and Delinquency Rates

The outstanding value of mortgage loans saw a marginal increase of 0.1% month-on-month, reaching HK$1,884.2 billion by the end of May. The mortgage delinquency ratio remained low at 0.13%, while the rescheduled loan ratio was stable at nearly zero, indicating a relatively healthy loan repayment environment.