New Hong Kong flat supply set for 8-year high
New flat supply in the city is projected to climb to an eight-year high next year, easing the upward pressure on home prices.
Preliminary figures from the Rating and Valuation Department's "Hong Kong Property Review 2013" report shows that 15,820 new flats will go on the market next year, 16.8 per cent more than this year's expected total of 13,550 units.
"The projection for completion of new flats next year will be the highest since 2006," said Patrick Chow Moon-kit, head of research at Ricacorp Properties.
In 2006, 16,579 new flats went on the market.
With the government moving to increase the land supply, Chow expects developers to be under pressure to speed up marketing of their new projects.
Midland Realty chief analyst Buggle Lau Ka-fai said up to 16,000 new flats could go on the market this year, up 42.85 per cent from last year's 11,200.
According to the government's report, nearly 83 per cent of completed flats will be in the New Territories this year, with Tseung Kwan O and Yuen Long each providing a quarter of the fresh supply.
With competition from the primary market, Chow said the rise in prices in the secondary residential market would also ease.
The Centa-City Leading Index, which tracks sales at 100 major housing estates in the city, fell for two consecutive weeks to March 31 to 123.01, down 0.52 per cent, after reaching a record 123.66 for the week to March 17.
Overall home sales also fell 30 per cent last month, reflecting a drop in buying interest following the new stamp duty.
On February 22, the government doubled the stamp duty on properties worth more than HK$2 million, and last month some of the city's biggest banks raised their mortgage rates.
The government announced yesterday that two residential sites would be put out for tender next month. Surveyors expect them to fetch between HK$3.7 billion and HK$3.97 billion in total.
One of them is a 283,112 square feet site situated in Tseung Kwan O, which can yield a maximum gross floor area of 821,028 sq ft. The government has stipulated the winning bidder has to build at least 840 flats on the site.
Midland Surveyors director Alvin Lam Tsz-pun said he expected this site to attract keen interest from developers and fetch HK$3.8 billion, or HK$4,600 per buildable square foot.
The estimate is higher than HK$4,301 per square foot Wheelock Properties paid for a neighbouring site on Wednesday.
Centaline Surveyors estimated the Tseung Kwan O site would sell for HK$4,300 per square foot, or HK$3.53 billion.
Another smaller site, in Tuen Mun's So Kwun Wat, is 37,211 sq ft and can yield up to 48,374 sq ft of gross floor area. It is expected to sell for HK$170 million to HK$193.5 million, or HK$3,500 to HK$4,000 per square foot. The tender for the two sites will open on May 10 and close on June 21.