Chief Executive John Lee on Wednesday announced that Hong Kong will ease its rules for property purchases under the New Capital Investment Entrant Scheme (CIES), as part of measures to spur real estate market growth.

The scheme allows high-net-worth individuals and their families to obtain residency in the SAR when they make investments of at least HK$30 million in funds, stocks or property, among other vehicles.

In his Policy Address, Lee said the maximum investment in non-residential properties that can be counted towards the scheme will be increased from HK$10 million to HK$15 million, with no transaction price threshold.

For residential properties, the investment cap will remain at HK$10 million, but the threshold for transaction prices will be lowered from HK$50 million to HK$30 million.

The changes come after industry leaders warned that the existing rules were harming interest in real estate investment.

Commenting on the new rules, Thomas Chak, head of capital markets and investment services at Colliers, said the agency welcomes the changes, especially the increase in the property investment amount.

"This adjustment is expected to further stimulate transaction volumes and support the recovery of Hong Kong's commercial real estate market, particularly benefiting strata office and retail shops," he said.

However, Marcos Chan, head of research at CBRE Hong Kong, said the measure on its own will not lead to a significant rise in demand for commercial properties.

"Purchase decisions will still depend on individual needs and the market fundamentals of the commercial sector," he said.

But Chan said the lowering of the investment threshold for residential properties will boost demand for luxury homes.

Hannah Jeong, head of valuation and advisory services at CBRE Hong Kong, said the adjustments to the scheme might not directly lead to an increase in terms of overall transaction volumes, but will inject positive momentum into the luxury home segment.

"Mainland buyers prefer a luxury apartment investment due to less maintenance requirements," she said, adding that there was an almost 60 percent annual increase in transaction volumes for units valued at over HK$100 million in the first eight months of the year, with half of the buyers from the mainland.

"We anticipate further growth in residential transaction volumes in the fourth quarter of this year, potentially pushing the annual total to over 65,000 units," she said.

"While this would still be about 15 percent lower compared to the 2021 peak of around 77,000 units, it reflects a strong recovery in market confidence and cross-border investment appetite."

So far, the new CIES scheme has attracted 1,963 applications and is expected to bring in at least HK$58 billion as of the end of August, Jeong said.