Since the central government introduced restrictions on investment in Hong Kong, transaction volumes across the top ten housing estates have kept in single digits for seven consecutive weeks, while primary market transactions have fallen by approximately 70%. Reports also showed that more than 70% of major real estate agency branches and around 80% of agents have recorded no transactions. In response to these challenging market conditions, major agencies have begun reviewing strategies to reduce their branch networks.
The investment restrictions have quickly reshaped Hong Kong’s property market. Major agencies recognize that current conditions 
are no longer supportive of speculative activity, yet they continue to project overly optimism to sustain market confidence. Much of the past buying momentum was driven by positive expectations; as confidence weakens, transaction volumes tend to decline sharply. The significant fall in both primary and secondary market activity since June reflects this broader deterioration in sentiment.
The latest secondary market property index, after rising for more than ten weeks, has begun to decline. Given that half of the top ten housing estates recorded zero transactions for seven consecutive weeks, the index might have been expected to show weakness earlier. The fact that the data is only now reflecting a modest decline suggests a lag between market activity and reported indicators.
Agencies should be aware of this shift. Beyond managing public messaging around lower sales volumes, their most immediate operational response is to reduce expenses and control daily operating costs. Branch consolidation is therefore likely to become increasingly common, with agencies choosing not to renew leases as contracts expire. Although this approach may not be highly effective, it still will be a practical way to relieve financial pressure. Preliminary estimates suggest that the two largest agencies may each reduce their branch networks by at least one third, equivalent to more than one hundred branches each. Frontline agents who are still in the industry should therefore prepare for further restructuring, as a wave of agency layoffs appears to have already begun quietly.
