Last month private home prices in Hong Kong ended a 10-month decline, rising 1.1% from February, following the city's decision to lift restrictions aimed at bolstering the struggling property market.

Official data released on Friday showed that the rise in home prices in one of the world's most expensive property markets followed a revised 1.7% fall in February.

During Q1, prices declined 1.8% after plummeting 20% from their 2021 high due to elevated mortgage rates, talent outflow and a weaker market outlook, Reuters reports.

At the end of February, Hong Kong abolished all additional stamp duties for foreign and second home buyers, as well as for those selling flats within two years of purchase. The property market immediately responded with an increase in transactions.

However, prices are expected to remain subdued as property developers hurried to launch new sales with steep discounts of up to 30%, drawing much of the buying interest away from the secondary home market.

According to real estate firm, Cushman & Wakefield, housing prices in Hong Kong have bottomed, yet a considerable rebound is unlikely due to economic uncertainties in a high-interest-rate environment.

It predicted a rebound of 5-7% in prices if the US Federal Reserve cuts interest rates in the second half, which Hong Kong banks could follow as the currency is pegged to the Dollar. 

Additionally, it predicted up to a 40% rebound in transactions for the full year.

Furthermore, a report by real estate agency Ricacorp earlier this week revealed that 30% of transactions of second-hand homes were sold at a loss in Q1, and it anticipates this trend to persist in Q2.