When Theo Bertrand moved back to Hong Kong last year, he found a city that was livelier than he expected. More career opportunities, a faster pace of life and lower taxes compared with the 50% on bonuses that the quant engineer was paying in Amsterdam.

“Sure the cost of living is higher but I end up winning,” said the 27-year-old French national, who first came to Hong Kong to study almost a decade ago and relocated back to be with his partner. With the conflict in the Middle East, he feels that cities such as Dubai, which they might have considered, have become less attractive.

Hong Kong is “the place to be for the next few years,” he said.

Arrivals like Bertrand show that Hong Kong, whose expat population was hollowed out by strict Covid rules and Beijing’s ever-tightening grip, is now enjoying a moment. Tens of thousands of people left the city in the two years through 2022, among them scores of bankers, lawyers and other skilled workers who made the city Asia’s foremost financial hub.

Now, thousands of white-collar professionals are making their way back. They are responding to a booming initial public offering market, planned tax breaks for private equity and hedge funds, and a more vibrant city. The influx is already showing from a jump in prime expat rents to fewer openings at elite international schools.

Official numbers are beginning to reveal momentum. There were 31,278 employment visa approvals for foreigners last year, more than double the number five years ago, with many going to nationals from Japan, South Korea and the UK. In financial services, visas for foreigners rose by 17% last year to the highest since 2022.

 

While the sustainability of the influx may hinge on the strength of the IPO market and the response from rival hubs including Singapore and Dubai, global financial firms including Bank of America Corp. and HSBC Holdings Plc are among those signaling confidence in Hong Kong.

Under pressure to head off potential relocations, the Monetary Authority of Singapore is already in talks with investment firms about cutting taxes. Globally, Hong Kong and Singapore rank third and fourth behind New York and London in the latest Global Financial Centres Index.

“More recently, improving capital markets activity, a stronger IPO environment and government initiatives aimed at enhancing Hong Kong’s competitiveness as an international financial center have contributed to renewed interest,” said Lee Voon Keong, Hong Kong-based head of talent solutions at consulting firm Aon. “That said, firms continue to monitor regulatory, geopolitical and macroeconomic developments closely.”

The expat inflow is distinct from previous booms. Of the over 410,000 approvals across various talent admission schemes in the last three years, almost three-quarters came from mainland China. Job options are narrowing for expats who increasingly need a specialized skill or to be senior internal transfers if they don’t speak Mandarin or Cantonese.

For now, Hong Kong is aggressively promoting the city’s low taxes and comparative lack of red tape to the world’s ultra-rich business owners and money managers. Officials recently proposed a bill that will effectively eliminate tax on performance-related income for some fund managers.

The policy pull coincides with a resurgence in IPOs from Chinese companies that helped lift the city out of years of pandemic stagnation. Optical equipment maker Zhongji Innolight Co. listed its shares last week after raising $6.8 billion in Hong Kong’s biggest first-time share sale in seven years. Goldman Sachs Group Inc. and Morgan Stanley were among the banks that led the deal.

 

Even as China cracks down on untaxed overseas wealth, founder exits have flowed to money managers and helped Hong Kong recently overtake Switzerland as the world’s biggest offshore wealth hub.

Global lenders are taking note and are rebuilding senior headcount. Bank of America is transferring Thorsten Pauli from Zurich to Hong Kong as head of Asia-Pacific capital markets. Aileen Taylor, HSBC’s group chief people and governance officer, plans to relocate from London to Hong Kong, according to people familiar with the matter, adding to its senior ranks in the city. Chief Executive Officer Georges Elhedery spent a stint earlier this year working out of Hong Kong, where the firm has about 20,000 staff.

John Tozzi is another returnee. The American recruiter, who left in late 2022, accepted a 30% pay cut to swap New York for Hong Kong in January. With the move, he believes he is doing “almost better” financially due to lower tax rates and a cheaper cost of living. Tozzi said he is seeing more expats following his move.

 

Spotting one of his favorite DJs, Steve Aoki, at Hong Kong International Airport was an example of how even the music scene had improved compared to when Tozzi left the city in 2022.

“We’re seeing expat candidates in London, Dubai and Sydney actively interviewing for managing director roles in Hong Kong, particularly within investment banking,” said William Bown, partner at executive search firm Maven Partnership. “That said, hiring from outside the region still requires a clear strategic rationale. For Western expats who aren’t internal transfers, the bar is high.”

The financial district’s once-deserted towers are getting busier. When The Henderson — a flagship 190-meter (620-feet) skyscraper built on the world’s most expensive plot of land — soft-launched in 2024, its 40% vacancy rate came to exemplify Hong Kong’s painful real estate downturn. The tower has now reached 90% occupancy, anchored by tenants such as Point72 Asset Management. Cheung Kong Center II, which sat largely vacant after its 2024 completion, has seen occupancy double to roughly 60% this year.

For many Western executives who relocated to Singapore during the pandemic, staying in the city-state has created new operational headaches. A US citizen and senior executive at a global asset management firm, who asked not to be named while discussing personal career plans, said he is preparing to move his family to Hong Kong after spending years shuttling between the two cities. Flying into Hong Kong 12 to 15 times a year from Singapore just to attend meetings became unsustainable, he said.

Being in Singapore makes him feel distanced from central decision-making, he said. If he lives in Hong Kong, he’d probably only need to fly to Singapore twice a year.

Elsewhere, signs of a recent influx are showing in school admissions and the residential rental market.

Neighborhoods popular with expats saw rents surge above the city average in the past year, data from online platform Spacious.hkshow. High-end areas Mid-Levels East and the Peak rose about 14% and 13% respectively in June from a year prior, compared to the average of 10% in the period.

 

In private education, the squeeze is even tighter. Waitlists across major international schools now stretch to a full year, according to consultancy Ampla Education. Over the last three years, the number of international school students in Hong Kong has risen by about 10% to more than 48,000, compared with a less than 5% increase in places on offer, according to data from Hong Kong’s Education Bureau.

Julianna Yau, director at Ampla Education, said that Hong Kong has seen a surge in returning expats alongside local families who had left during Covid. Last year, when she helped an American family place their children at The Harbour School, an international school that opened just under two decades ago, the process was seamless. This year, when she submitted an application for another expat family at the exact same school, they were all placed on a waitlist, she said.