Green Code, a new residential project in Fanling, has become the market indicator of housing demand in the New Territories after the government released its latest round of cooling measures.
The 728-flat project being developed by Hong Kong Ferry (Holdings) is on the corner of Mak Sik Road and Sha Tau Kok Road, Fanling, next to the 15-year-old Belair Monte, which has been developed by a consortium of 11 developers.
Hong Kong Ferry launched a total of 396 flats for sale yesterday, and market sources said 50 were sold in the first hour. It is the first new project put on the market since the government introduced a new round of cooling measures for the property market on February 22.
Prices of the units ranged between HK$8,338 and HK$11,975 per square foot. The prices in terms of saleable area are lower than flats at Residence 88, a new project in Yuen Long developed by Sun Hung Kai Properties, launched in February.
But the average price in terms of gross floor area is at least 21 per cent higher than the nearby housing estates in the secondary market. Data from Centaline Property Agency showed the average prices of 13-year-old Regentville and 11-year-old Grand Regentville ranged between HK$4,545 and HK$5,800 per sq ft.
"The asking prices of Green Code are 5 to 10 per cent lower than my expectations," said Sammy Po Siu-ming, a director at Midland Realty.
"I think it is because the market sentiment was weakened after the new cooling measures were introduced. Developers are asking for relatively conservative prices."
An agent who did not want to be named said: "The 20 per cent price difference with secondhand flats is reasonable. If buyers are looking for a cheaper property, Green Code may be suitable for them. Future housing supply will be lower in Fanling than Yuen Long.
"It helps property prices to stay firm and even enjoy a higher price growth. But future development in Yuen Long is better as many new projects such as shopping malls are being built."
The entry price of Green Code is about HK$2.67 million for a flat with a saleable area of 262 sq ft.
More than 1,000 potential buyers have shown interest since the price list was released.
"Two-bedroom flats with a store room are the most popular," said Po.
"About 90 per cent of potential buyers are end-users, and about 50 to 60 per cent are New Territories residents. Many are young couples."
Tommy Chow, sales director at Ricacorp Properties, said 10 to 20 per cent of potential buyers were long-term investors.
He estimated the yield could reach up to 2.6 per cent based on the rental level of about HK$23 per sq ft.
The gross floor area of typical flats at Green Code range from 384 to 1,071 sq ft.