Strong property demand expected as record numbers go up for sale

Optimistic outlook after 1000 apartments hit the market on first weekend of September and bumper August figures

PUBLISHED : Saturday, 03 September, 2016, 9:17pm
UPDATED : Saturday, 03 September, 2016, 11:31pm

Industry representatives are confident that property demand is set to increase, with more than 1000 new Hong Kong apartments going up for sale Saturday – the most to hit the market in a single day in three years.

“This is the first time that new developments have attracted such a strong interest among home buyers in Hong Kong,” Louis Chan Wing-kit, Centaline Property Asia-Pacific residential chief executive, said.

One Kai Tak, Papillions and Grand Yoho were the three highlight developments of the day.

The Papillions, developed by Chinachem Group in Tseung Kwan O, had the most listings of the day with 535 units on sale. Their prices ranged from HK$14,112 to HK$10,608 per square foot.

“All of the units (in the Papillions) are expected to be sold out today,” Chan said, adding that more than 140 units had been sold by midday Saturday.

One Kai Tak, being developed by China Overseas Land & Investment on the site of Hong Kong’s former airport, had 300 units on sale.

“Although there are many restrictions on the resale of apartments in the development, the price is quite attractive,” a potential buyer named Mr Wong said.

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China Overseas said the units were priced between HK$5.82 million and HK$14.6 million, and after discount, they would be reduced to HK$12,741 to HK$15,562 per square foot.

The first round of sales of the One Kai Tak development has been reserved for buyers with Hong Kong permanent identity cards only, under the “Hong Kong Property for Hong Kong People” programme. All units have been prohibited from resale to non-Hong Kong permanent residents for a period of 30 years. Each rental lease term is limited to five years.

As of last Friday, China Overseas claimed to have received about 11,000 subscriptions for the 300 apartments on offer. Chinachem has received about 8,500 subscriptions for the 535 flats up for grabs.

After moderating for almost one year, home sales in Hong Kong have shown signs of growth with 2490 units sold in August, according to the Sales of First-hand Residential Properties Authority.

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Looking forward, Centaline’s Chan said he expects that figure to increase to 3200 units this month.

“Due to the Brexit and the prospect that the Federal Reserve is unlikely to raise interest rates until the end of the year, investors have been losing confidence in the Hong Kong dollar, which has prompted their enthusiasm for real estate investments,” he said

The optimistic outlook was echoed by Midland Realty, which predicted 2700 unit sales this month.