PROPERTY
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New World Development

New World to keep pace on sales despite stamp duty

New stamp duty has little effect on developer's sales timetable as few buyers are from mainland

PUBLISHED : Thursday, 22 November, 2012, 12:00am
UPDATED : Thursday, 22 November, 2012, 3:39am

New World Development does not plan to change its timetable for property sales despite the impact of the new buyer's stamp duty on demand from those who are not permanent residents.

"We need time to monitor the impact of the duty on the property market," executive director and joint general manager Adrian Cheng Chi-kong said after the company's annual general meeting yesterday.

Cheng said not all property buyers were speculators, and the new duty would also affect people buying a home to live in.

"The best way to balance the property market is to increase land supply," he said.

Cheng warned that capital would flow into other investments, such as stocks, if the government extended the cooling measures to non-residential property.

Although mainland buyers would be affected by the stamp duty, only about 10 to 15 per cent of the homebuyers at new projects were from the mainland.

"We didn't see mainland buyers decrease sharply, as only a small portion of our buyers are mainlanders. Most of our buyers are local end-users," Cheng said.

The developer had generated more than HK$5 billion from property sales so far this financial year, which started in July - better than it expected.

New World planned to launch six projects next year, starting in February.

The developer had sold Riviera Plaza, a shopping centre in Tsuen Wan, for HK$508 million to Wang On Group.

"The price is reasonable. We have met our sales target in residential sales. We have no plan to speed up our pace in selling non-core properties and car parking spaces," Cheng said.

In the leasing market, he expects the rental income from New World's property portfolio to rise between 10 and 13 per cent in this financial year.

"We continue to improve our shopping malls. Our headquarters, New World Tower, in Central will also provide more retail space," he said. "Our office portfolio is expected to record rental growth from lease renewals next year."

Cheng expects residential property prices to rise between 8 and 10 per cent for all of this year.

"But the price movement next year is unpredictable," he said. "I believe it will be stable in the long run."

New World shares rose 1.32 per cent to HK$12.26 yesterday.