New World Development took the plunge at the weekend and discounted prices at its Park Signature project in Yuen Long - attracting the strongest buying response since the Residential Properties (First-hand Sales) Ordinance took effect on April 29.
With more than 6,000 new homes estimated by analysts to be available for sale in Yuen Long in the next 12 months, was New World aiming to get in early in anticipation of further price falls? And if so, can buyers expect even better deals if they watch and wait?
"You have been waiting for prices to fall for so long," said Thomas Lam, head of research at property consultancy Knight Frank. "Why not continue to be patient and wait for when the new supply floods into the market?"
New World may have set the tone for new releases by discounting prices by more than 15 per cent from those at new projects in the same area, and offering attractive financing terms. It put 238 flats up for sale at the 1,620-unit Park Signature project at the weekend and sold about 200.
That was the strongest response to sales at a new project since April. Developers have postponed sales as market sentiment deteriorated after tougher sales rules came into force and other property measures announced by the government since October.
At an average HK$8,345 per square foot of saleable area, the flats were priced about 17 per cent below the HK$10,086 per square foot average fetched for 500 flats in July at the Reach, a project of Henderson Land Development and New World, also in Yuen Long. Sun Hung Kai Properties offered the remaining 69 homes at Residence 88 in Yuen Long last month at an average HK$10,986 per square foot.
According to Ricacorp Properties, there are 6,409 flats available for sale in Yuen Long, including the Hong Shui Kiu area, 2,176 in Tsuen Wan and Kwai Chung, and 1,648 in Tseung Kwan O.
With more than 10,000 flats of a similar class available for sale in these four areas in the next 12 months, it might be reasonable to expect developers will feel the need to compete for buyers by offering further price cuts.
If you believe this is likely, it would make sense to watch and wait, as some analysts suggest.
But if you are risk-averse and tired of waiting, like prospective buyer Franky Li, you'll take what discounts are on offer now.
Li, a senior marketing manager, bought one of the Park Signature flats on Saturday and said he made his decision even though prices might fall further, because he did not want to become captive to a volatile market. Prices could go up as well as down, he said, and he needed a flat to live in.
Developers may be banking on more buyers like Li and there is a chance they may not discount prices any further.
However, if you are cashed up and want to buy a home, but are prepared to take the risk and wait to see if prices fall further, what can you do with your cash in the meantime?
You could buy a small flat that would leave you less exposed to the property market in the event prices fall further. Investing in overseas property might seem appealing, too.
These may not be bad options if you time your exit correctly and cash up again for when bargain homes come to the Hong Kong market - if that is indeed in the cards.