According to the latest issue of RLB Construction Cost Update HK Report, tender price trends will hinge largely on the persistence of geopolitical disruptions and their downstream effects on PRC manufacturing and outbound logistics.
In the near term, modest upward adjustments remain possible, particularly in trades sensitive to fuel, freight and commodity‑driven inputs. Nonetheless, competitive tendering conditions are expected to keep overall price movements within a relatively narrow band.
Hong Kong’s construction market closed 2025 against a backdrop of cautious economic optimism. However, activity within the construction sector remained subdued. Overall output fell by 9.3% year‑on‑year, reflecting the combined effects of weak private‑sector investment and delayed development momentum. In contrast, public‑sector works rose by 7.4%, though this uplift was insufficient to offset the sharp 22.3% contraction in private‑sector projects, which continued to weigh heavily on industry sentiment.
Government infrastructure commitments remained a key stabiliser during the period. In its 2026–27 Budget, the administration reiterated its long‑term investment strategy through major initiatives such as the Transport Strategy Blueprint and the “Eight Vertical and Eight Horizontal” transport network. The forward pipeline of public works remains substantial, signaling continued support for construction demand despite short‑term market softness.
Private housing supply weakened concurrently. Completion for the quarter reached approximately 18,400 units, a notable 24.3% decline from the previous year. While private developers continue to adopt a cautious stance in light of prevailing market conditions, the overall economic outlook remains moderately positive, with public‑sector investment expected to anchor near‑term stability.
Recent geopolitical tensions emerging from the Middle East have introduced new cost pressures on the global supply chain. These tensions have disrupted global energy markets, driven up fuel costs, and caused intermittent delays across major shipping routes. Nonetheless, uncertainty around material costs is prompting a more conservative approach in tenders. External risks—rather than local demand—are now the primary source of upward pressure.
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