South Horizons landlords raise prices 30pc in aggressive push

Landlords of South Horizons in Ap Lei Chau have raised their asking prices by almost 30 per cent, taking advantage of positive news on the launch of a project in the district.

Realtors said that South Horizons flat owners believed their properties should be valued at a higher price after Sun Hung Kai Properties priced Sham Wan Towers at 20 per cent above the secondary market.

'They raised asking prices by 20 to 30 per cent since the news of the Sham Wan Towers launch was reported last month,' Hong Kong Property Services Agency director Fredy Wu Yat-fat said.

However, Mr Wu said transaction prices were 5 per cent higher than a month ago as homebuyers were unwilling to pay too much.

'Buyers have many choices as there are a lot of secondary flats available in South Horizons,' he said.

South Horizons, built nine to 14 years ago, has 35 towers spread in four phases. Prices now range from $2,600 per square foot to $3,600 per square foot, Mr Wu said.

Billy Wong, Centaline Property Agency senior sales manager at South Horizons branch, said: 'You could buy a two-bedroom apartment at below $1.3 million during the Sars period, but now you must be willing to pay $1.7 million.'

He cited another example.

'A recent client wanted to buy a 1,100 sq ft full sea view apartment with an asking price of $3.08 million during Sars.

'With improved market sentiment, the landlord raised his prices several times from $3.08 million to $4.7 million.

'When my client promised to pay $4.7 million, the landlord declined to sell and asked for $4.8 million. The deal eventually was cancelled,' said Mr Wong.

He said banks valued it at only $3.6 million. However, Mr Wong said transaction activity was likely to slow as landlords aggressively raised their asking prices to a level that buyers at present would not accept.

According to Hong Kong Property, 51 transactions of South Horizons flats were registered last month, against 22 in March during the Sars outbreak. Mr Wong said Sham Wan Towers might not draw potential buyers from South Horizons due to the big price difference. 'You pay $2.5 million for a 645 sq ft Sham Wan Towers apartment. But with such a price you can have a 900 sq ft unit more than 10 years old in South Horizons,' he said.