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Peggy Ye

Hong Kong landlords and property industry figures are accusing banks of deepening the city’s shop slump by pulling back from commercial mortgages, leaving more potential buyers unable to secure financing even though property values have fallen sharply.
Shop buyers were increasingly being turned away, even though Hong Kong’s residential market had gained momentum this year and banks were competing for mortgage borrowers, they said.
Shih Wing-ching, founder of Centaline Property, said banks tended to be positive with prospective buyers initially, but financing often became difficult once deals reached the approval stage.
“It takes a long time,” Shih said at a press conference organised by advocacy group Momentum 107 on Monday. “A considerable number of clients end up unable to get financing at the last minute … If it weren’t for this, there would be many more shop transactions.”
Raymond Ho, convenor of Momentum 107, said the sharp decline in shop values over the last few years had rapidly eroded the pool of available capital, weighing on investment and consumption.
Banks were pressing owners to repay loans amid falling property values while also refusing to provide mortgages to new buyers, which discouraged both users and investors from entering the market, further reducing transactions.
Banks’ tougher stance comes as lenders face growing pressure to address troubled commercial-property loans as falling valuations make it harder to justify extending debt.
“The situation now is that when banks hear it is a shop, they do not do the mortgage,” Ho said, creating a vicious cycle in which lenders’ actions were reinforcing the market downturn.
Raymond Tsoi Chi-chung, founder of Asia Property Agency, said shop mortgage lending was at about 20 per cent of its peak right now.
Many people he knew in banks’ loan-approval departments had failed to complete even a single shop loan recently, he added.
Tsoi attributed some of the banks’ caution to losses in their mainland China businesses, but said Hong Kong commercial-property loans were generally backed by collateral.
“It’s not right to lose money in mainland China and then blame Hong Kong,” he said.
Many shop investors are business owners who used leverage to build their property holdings during the boom, but some are now facing severe financial pressure, including forced sales of luxury homes.
The financing squeeze comes after years of weakness in the retail-property market. Average monthly transactions have plunged to about 60 from around 600 at the market’s peak, according to Midland Realty. Shop prices have fallen more than 40 per cent from their 2018 peak, and the vacancy rate reached 12.5 per cent at the end of 2025, a 40-year high, according to Momentum 107.
The impact extends beyond property owners. Tony Kwok Tak-leung, chairman of the Guangdong Hong Kong Macau Greater Bay Area General Chamber of Real Estate, said neighbourhood areas such as Kowloon West had unusually high numbers of vacant shops.
“Some people don’t need to borrow, but when they see banks taking such a negative view, they decide not to buy,” Kwok said. “Having collateral and still not getting a loan is absurd.”


John Wong, president of the Federation of Hong Kong Brands, said businesses wanted lower rents, but shop values and rents had become increasingly disconnected.
Landlords were already offering concessions including rent-free periods and renovation subsidies of as much as HK$1 million, he added.
Industry representatives called for higher commercial mortgage loan-to-value ratios, faster approvals and more objective valuations, while urging banks to handle loan calls case by case.
“If commercial and retail properties do not recover, Hong Kong’s economy will not recover,” Tsoi said.


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Pressing owners to repay loans amid falling values while turning away new buyers could prolong wider economic drag, advocacy group says


Pressing owners to repay loans amid falling values while turning away new buyers could prolong wider economic drag, advocacy group says.


Hong Kong landlords accuse banks of deepening shop slump with reluctance to lend

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Pressing owners to repay loans amid falling values while turning away new buyers could prolong wider economic drag, advocacy group says

Pressing owners to repay loans amid falling values while turning away new buyers could prolong wider economic drag, advocacy group says