According to Land Power International Holdings, a property brokerage, Shenzhen remained the most popular location for Hong Kong investors.

Land Power chairman Michael Choi attributed the surge to the territory's rebounding economy, opportunities afforded by the Closer Economic Partnership Arrangement (Cepa) between the territory and China and optimism among Hong Kong investors about mainland property market prospects.

``The implementation of Cepa, including simplifying procedures for doing business on the mainland, has attracted more Hong Kong people to do business there and brought more Hong Kong people to work there as a result,'' Choi said.

Hong Kong people bought between 15,500 and 16,700 flats in the first three quarters, up 21 per cent from the same period last year.

About 48 per cent of the total, or 7,500 to 8,000 units, were in Shenzhen, whose proximity to the territory and similar lifestyles were a major attraction. Choi said 72 per cent of Hong Kong buyers of homes in Shenzhen in the first three quarters said proximity was their main consideration.

``Some 37 per cent said they needed to cross the border once or twice a week while 21 per cent needed to go to Shenzhen three or four times a week,'' he said.

Thirty-one per cent said they bought flats in Shenzhen for work convenience and 27 per cent said it was for investment. Twelve per cent of Hong Kong buyers in Shenzhen bought flats to use during holidays and 3 per cent for retirement, down from 18 per cent and 5 per cent, respectively, a year earlier.

Choi said the central government's efforts to rein in property speculation had affected developers more than homebuyers. ``Property prices increased slowly and steadily in the first three quarters,'' Choi said. ``Prices of good quality properties rose by 7-8 per cent in Shenzhen, 8-9 per cent in Guangzhou, 7-8 per cent in Shanghai and 0-1 per cent in the Pearl River Delta,'' he said.

Choi expected prices of good quality properties in Shenzhen to rise 9-10 per cent for the whole of this year while Shanghai would see increases of 8-9 per cent and prices would rise 1-2 per cent in the delta.

``With no more macroeconomic controls pending, strong economic growth in China, continued strong demand from home and overseas, as well as a healthy property development on the mainland, we think the real estate market has a good outlook in the coming years,'' he said.

He expected that for the whole of this year, Hong Kong people would buy about 23,800 flats on the mainland, with total spending amounting to some 12.9 billion yuan, up 15 per cent from last year.

Choi said 40 per cent of those who bought properties in the first three quarters said they would consider buying mainland properties again, with 84 per cent choosing Shenzhen. ``The buying of homes will become a major trend because 73 per cent indicated they would use them as their home if they bought properties in China again,'' he said. olivia.chung@globalchina.com