Hong Kong's bull market is widely known to be supported by two key factors - low interest rates and the recovery in property prices.

There is, of course, a less obvious third factor, which is the influx of overseas capital to take advantage of the Hong Kong dollar strengthening against most regional currencies.

All these working together have triggered a strong rally that began in early July. Since then, the benchmark index has shot up about 20 percent on significant increases in average daily turnover.

With shares trading at an average multiple of about 12 times and an average dividend payout of more than 3.5 percent, Hong Kong equities are obviously a much better investment than bonds or most bank wealth management products. They certainly beat bank deposits on any terms in such a low interest-rate environment.

For overseas investors parking their money in Hong Kong equities, there is the potential bonus of foreign exchange gains from the projected appreciation of the Hong Kong dollar against their respective home currencies.

An expected US interest-rate hike later this year could be a damper. But statements from the US Federal Reserve have indicated that the increases would be gradual and moderate. Investors are expecting low interest rates to remain largely undisturbed in the foreseeable future.

In fact, the cost of borrowing that matters most to Hong Kong people is actually going down. The major banks are cutting the interest rate for mortgage loans to 25 basis points above the cost of funds to compete for market share in the business that provides a major source of steady and dependable income.

Apparently, many potential homes buyers are finding such borrowing terms irresistible. The surge in demand by purchasers eager to lock in the low spread in mortgage financing has continued to push up property prices, which started going up in May this year. Since then, the market momentum has gathered strength.

The latest government survey shows that homes prices rose at a faster pace in July than in previous months, with the price index moving up nearly 2 percent, compared to 0.2 percent growth the month before. At current levels, local property prices are just 8 percent lower than their peaks reached in September last year.

It's often said that properties are the bedrock of equities as many major listed companies are either directly or indirectly engaged in real-estate development or investment. From what investors are seeing in the property sector, they can find plenty of reasons to remain bullish about stocks.