While the picture on the ground looks promising, analysts see property prices undergoing a sharp correction.
Deutsche Bank forecast last month that Hong Kong home prices could drop up to 50 percent in the next 12 months, while Barclays said the market will enter its first real downturn since 1998 with a 30 percent plunge by 2015.
"The developers created this 'wow factor'. They managed to draw out some people who wanted to buy and were looking for price cuts," said Barclays property analyst Paul Louie, citing two recent projects that offered discounts of up to 40 percent.
"We are just seeing the beginning of the round of price cutting. There will be more to come," he said. "The buyers will return to the sidelines and wait for better deals."
The price difference between new launches and second-hand homes - an indicator of developers' profitability - dropped to its lowest since 2003 at 12 percent in the third quarter of 2013, according to real estate company Midland Realty.
Hang Lung Properties and New World Development declined to comment on whether they would continue to offer discounts.
Wong Leung Sing, research director at Centaline Property Agency believed the buyers, rather than the analysts, would be proven correct over the price trend.
"We can't find the factors that will lead the market to plunge," Wong said. "Investors are still quite optimistic."
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More than 5,000 small-to-medium units will be released by developers such as Cheung Kong and Sino Land in the first quarter of next year, pushing inventory of new homes to a ten-year high and posting what Wong called "a real test" to mass consumers' purchasing power.
"The day of reckoning will be decided by the middle class," Wong said.
Calling the bottom
Amid forecasts of a collapse in the property market and general gloom over the outlook for home prices, there are still some who say the worst is over.
"The government tightening just pushed back the timing of the purchase for Chinese buyers," said Patrick Chau, director of residential sales at property consultant Savills. "You can never suppress the demand from that market."
Some developers are also upbeat, prompting them to start scaling back some of the incentives previously on offer.
The city's largest developer Sun Hung Kai Properties raised the price of the high-end project near Kowloon West by up to 10 percent after a strong market response - it received over 2,000 applications for a re-launch of 60 units.
With the city's healthy 54 percent loan-to-value ratio, the absence of an immediate interest rate hike, and strong purchasing power from end-users and investors, Chau expected home prices to rise a further 5 percent by the second quarter of 2014.
"Here, at the front line of the market, we don't see the correction that investment banks are talking about."