HSBC, Standard Chartered and Bank of China (Hong Kong) on Thursday announced raising their best lending rates by 25 basis points following interest rate hikes by the Monetary Authority and the US Federal Reserve.

This marked the third increase in prime rates this year for the local lenders.

Starting Friday, HSBC's best lending rate will go up to 5.625 percent.

On Monday, the prime lending rate at Standard Chartered will go up to 5.875 percent and it'll be 5.625 percent at Bank of China (Hong Kong).

Hannah Jeong, the head of valuation and advisory services for Colliers, said she expects property prices to drop by 5 percent next year from current levels as higher borrowing costs continue to dampen sentiment.

"The borrowing cost is too high that most of the rents are not able to cover interest payments, therefore if someone is buying for investment purposes, that activity will dry up a little bit.

"Mainly the end users who want to occupy their units are utilising the low market base, those activity will continue."

HSBC, Standard Chartered and Bank of China (Hong Kong) also raised their Hong Kong dollar savings rate by 25 basis points to 0.625 percent.