Developers were out in force yesterday for the financial year's last residential land auction. The two sites fetched higher than expected prices in the wake of the Government's property stimulus measures. Medium-sized developer K Wah International took the bigger lot, a 78,533-square foot Ma On Shan site, for HK$560 million after fierce bidding against five major rivals including Sun Hung Kai Properties (SHKP) and Henderson Land Development. Other bidders were New World Development, Nan Fung Development and Sino Land. Capital Group Development also outbid five competitors for the second lot, a 55,326-sq ft low-density residential site in Sai Kung for HK$73.5 million. Prices for both lots were more than 10 per cent above market expectations. Analysts said the keen bidding was largely due to last week's Government decision to cut back land sales next financial year, and relax restrictions on flat sales. They said the bidding reflected developers' revived confidence, while estate agents expected transactions and prices to rise. However, Insignia Brooke (Hong Kong) consultant Nicholas Brooke said the auction results actually were within expectations, given the Government's property stimulus measures, and dubbed the result a 'controlled response' from developers. SHKP executive director Thomas Chan Kui-yuen said the price of the Ma On Shan lot was higher than expected. He forecast a recovery in market confidence following the recent Government moves. Cheung Kong (Holdings) deputy chairman Victor Li Tzar-kuoi said the price was good and the aggressive bids reflected confidence. Bidding for the Ma On Shan site opened at HK$450 million. The HK$560 million sale price represents an accommodation value of HK$1,426 per sq ft, compared with the average of HK$1,412 per sq ft paid by Sino Land for an adjacent site in August. The Sai Kung lot's opening price was HK$50 million and the winning HK$73.5 million bid had an accommodation value of HK$1,771 per sq ft. K Wah International chairman Lui Che-woo said the company planned to spend HK$1.3 billion for a two-block development with 392,667 sq ft of floor area on the Ma On Shan site. He expected the finished flats to sell at an average price of HK$4,000 per sq ft. He said the market was recovering following recent Government moves and he anticipated prices to rise by 5 per cent to 10 per cent in the next few months. Surpass Property Strategy Consultants managing director Charles Lai expected developers to raise prices or hold back sales in the coming months while individual owners in the secondary market would raise prices by 8 per cent to 10 per cent. But whether this situation could be sustained would depend on buyers' attitudes and those remained to be seen, he said.