image

Weekend Property

Perfect connection: Kowloon Station’s appeal grows with high-speed rail terminus and cultural district nearing completion

Demand from first-time buyers is driving market activity as punitive taxes against buy-to-let and foreign buyers continue to take their toll

PUBLISHED : Friday, 07 April, 2017, 11:01am
UPDATED : Friday, 07 April, 2017, 12:17pm

Developments around Kowloon station have shot up in recent years, as the high-speed rail terminus and the West Kowloon Cultural District near completion.

Estate agents in the area say grade A housing developments have seen prices rise on a monthly basis as most apartments are bought by local high-net-worth (HNW) investors and rich mainlanders.

The recent sale of Cullinan West, above Nam Cheong station and developed by Sun Hung Kai Properties, is a case in point.

According to Land Registry figures compiled by Ricacorp Properties, home sales volumes across the housing estates near and atop Kowloon station in February increased 16 per cent to 29 transactions from the preceding month. The Harbourside development recorded 10 deals, while Sorrento saw nine.

Occupying a prime harbourfront location, right next to the key infrastructure developments that are now taking shape, there is no doubt that the Kowloon station housing estates command top dollar, say property agents and analysts.

The average unit price achieved on all sales from March 2016 to February 2017 at The Cullinan and The Arch was about HK$38,370 per square foot and HK$31,243 per square foot, respectively. The pricing levels of The Harbourside and Sorrento were around HK$26,548 per square foot and H$20,756 square foot, respectively, over the same period.

In February, a 1,377 sq ft four-bedroom home on the 79th floor at The Cullinan II (Diamond Sky) fetched about HK$71.6 million, equivalent to about HK$51,990 per square foot. In a notable deal closed last year, a 4,398 sq ft triplex on the 80th to 82nd floor at The Arch (Block 2, Moon Tower) sold for about HK$423.8 million, or around HK$96,362 per square foot.

Lily Shum, a Midland Realty agent based in the Kowloon station area, says buyers’ confidence has strengthened in the past two months. Potential buyers finally see light at the end of the tunnel as construction of the high-speed rail terminus, located next to the existing Kowloon station, is expected to be completed next year after years of delays and postponements.

“As they come to view homes, they now can see the future high-speed railway station and West Kowloon Cultural District. This area will soon become a transport, cultural and office hub, and together they paint a bright picture of the future,” she says.

“Just look at the prices. A one-bedroom flat in a new Tsuen Wan development has been sold for more than HK$10 million, while new Kai Tak properties are being sold at Kowloon station prices,” Shum says.

“It feels like the Kowloon station properties are underpriced compared to them.”

Midland is now marketing several listings within the Cullinan complex, including a mid-floor 1,128 sq ft four-bedroom home at Diamond Sky that comes with a price tag of HK$53 million; a 872 sq ft three-bedroom at Luna Sky priced at HK$32 million; and a 1,942 sq ft four-bedroom flat with private terrace at Sun Sky comes with an asking figure of HK$200 million.

At The Arch, a 970 sq ft three-bedroom (Unit D) on a high floor at Moon Tower is also on the market, for which the seller is asking HK$35 million, according to Midland Realty.

Like elsewhere, demand from first-time buyers is driving the market activity as punitive taxes against buy-to-let and foreign buyers continue to take their toll.

Property agency Qfang.com says a first-time buyer purchased a 752 sq ft three-bedroom flat, which has a walkout terrace, for HK$16.5 million, or about HK$21,940 per square foot in February.

Despite the controversy over the unexpectedly high building costs and installation of mainland China’s law-enforcement officers in the city’s jurisdiction, the high-speed rail link is now expected to start operations as early as the third quarter next year.

From that time, a train journey to Beijing will take less than eight hours, while a ride to the neighbouring cities of Guangzhou and Dongguan will take no more than 48 minutes, excluding customs clearance.

According to development plans, the West Kowloon Cultural District will comprise indoor and outdoor arts and cultural venues, as well as 23 hectares of open space including parks and a waterfront promenade.

The M+ Pavilion, an exhibition venue, opened last September. Construction on other facilities are in full swing. Among them, the Xiqu Centre, the Chinese opera venue, is scheduled for completion this year. Lyric Theatre complex, a dance performance venue and theatre, will be completed as early as 2020.

Last December, the government announced that it would build a 10,000-square-metre museum to house a permanent display of relics provided by the Palace Museum in Beijing on a long-term basis.