Hong Kong luxury home prices may rise 20% this year as the economy expands and supply remains limited, real estate broker CB Richard Ellis Group said.

Mass residential prices in the city may rise 15% in 2010, CBRE said at a briefing in Hong Kong. Luxury homes are those costing at least HK$10m ($1.28m) each.

Home prices in Hong Kong rose 29% last year, outperforming Tokyo, London and New York, as record low mortgage costs, near-zero interest rates on savings deposits, and buying by mainland Chinese stoked demand. Existing residential property values, now at the highest in almost 12 years, may rise another 35%, according to Centaline Property Agency Ltd.

bloomberg.com