Sun Hung Kai Properties (SHKP) needs to adopt a price undercutting tactic to lure buyers to the 1,024 units to be released this month at the company's Sha Tin development, according to property agents. Centaline Property Agency's Yuen Wai-chung said the initial batch of Prima Villa flats would need to be released at below second-hand home prices as buyers remained price-sensitive. He expected the price range of HK$3,000 to HK$3,200 per square foot would be attractive compared to secondary-transacted prices in City One Sha Tin, which were between HK$3,200 per square foot and HK$3,500 per square foot. Transacted prices in the area had dropped 10 per cent from last month, he said. SHKP's marketing arm, Sun Hung Kai Real Estate Agency, is expected to secure pre-sale consent for Prima Villa in about two weeks, and it would begin sales shortly afterwards, sales general manager Eric Chow said. The development's units are 500 sq ft each. Mr Chow said prices for Prima Villa would take into account the second-hand transacted prices of about HK$4,000 per square foot in the area. SHKP sales general manager Alfred So Chung-keung said developers were unlikely to enter another price war despite lacklustre market sentiment. He said he remained optimistic about the housing sector, pointing out home prices would increase 10 per cent this year given the improving economy. He dismissed the potential impact of further rises in interest rates in the United States on the market, saying it would be offset by banks' continuing preferential mortgage terms. He said SHKP planned to release 3,000 units, including Prima Villa, for pre-sale in the next six months. The other developments include 1,200 units at Villa Esplanada phase three development in Tsing Yi and 424 units at Oscar by the Sea in Tseung Kwan O. Mr So said encouraging responses were received for the remaining units of its Palatial Coast in Siu Lam after it made unit prices negotiable. Buyers could also receive a free car-parking space and a waiver on legal fees. Agents said the developer sold about 20 units in the past three days and buyers could ask for a price discount of 3 per cent to 5 per cent. Units were offered at an average price of $3,700 per sqaure foot, agents said.