Morgan Stanley published a research report indicating that the Hong Kong Real Estate market is not expected to show improvement next year and is still anticipated to be full of challenges. The sustained high interest rates are unfavorable for the overall development of the Hong Kong property market. Although local Real Estate stocks are comparatively undervalued, Morgan Stanley believes that the market is oversupplied, with developers accumulating inventory, which does not help market development. Currently, it is predicted that residential property prices will continue to decline in the first half of next year, and with favorable factors such as increased mortgage ratios, the cancellation of special stamp duty, declining mortgage rates, rising rental levels, and population Inflow, property prices should help increase in the second half of next year.

Morgan Stanley is Bullish on developers with sustainable dividends, preferring NEW WORLD DEV (00017.HK) and Link REIT (00823.HK), both receiving a "Shareholding" rating. Morgan Stanley also mentioned that considering NEW WORLD DEV's recent personnel changes and high debt levels, a "Shareholding" rating is given. WHARF REIC (01997.HK) and Hysan (00014.HK) also received a "Shareholding" rating, mainly due to the lack of improvement in the retail market.