Hong Kong luxury residential market faces test on weekend as developers cut prices to push sales

Hong Kong’s luxury residential property market will face a real test this weekend when Kerry Properties starts selling its Mantin Heights in Ho Man Tin in the face of a rising number of defaults and price cuts by rival developments in the area.

Ho Man Tin is in the grip of a price war among developers, who have flooded the area with more than 2,000 new units. Wheelock Properties on Friday fired the first salvo by slashing prices by another 8 per cent for its 561-unit One Homantin to undercut Kerry Properties’ 1,429-unit Mantin Heights scheduled to come on the market on Saturday.

Louis Chan Wing-kit, Centaline Property Agency’s managing director, residential, blamed the continuous increase in supply and a looming economic slowdown for the tepid buyer response.

“As potential buyers are likely to defer purchases in anticipation of more price cuts by developers, homebuying interest will be further dampened,” said Chan.

Wheelock’s steep discount has already scared off buyers of One Homantin. Instead of speeding up sales, just 12 of the second batch of 74 flats put on the market were sold by Monday. Along with the 33 flats sold in the first batch, Wheelock has sold 45 units since the launch a week ago.

Buyers are also increasingly walking away from deals. A buyer has just cancelled the purchase of a 1,708 square feet unit priced at HK$69.5 million at Ultima phase two. The developer, SHKP, can forfeit the initial deposit of about HK$3.5 million.