Just who is buying the Kai Tak residential units?
Most are Hong Kong identity card holders, says Oliver Lam from developer K Wah International
Home prices in Hong Kong have hit an all-time high, with many buyers left having to play a guessing game on what might trigger the next property buying frenzy.
One Hong Kong developer to have reaped HK$7 billion in property sales from the recent launch of its residential project at the site of the former Kai Tak airport, says the majority of his buyers are Hong Kong residents.
“Geographically, most are Hong Kong identity card holders”, said Oliver Lam, chief financial officer of K Wah International Holdings, the developer behind the “K City” development at the site.
“We haven’t any official figures on where buyers are actually from. But if we use identify card holders as a classification, more have Hong Kong identities,” Lam told South China Morning Post.
“I do not have the feeling that many are mainland buyers,” he added.
The K City development, the second residential project to hit the market at Kai Tak, caught the city by surprise when it was firstly launched in February, with one first-time buyer snapping up 15 units worth HK$145 million in a single purchase, triggering concerns that panicking investors have been rushing into the market.
Home prices in Hong Kong, the world’s least affordable major city, rose for the 11th consecutive month to an all-time high in February.
That month’s home price index, which represents price movements in the used property market, rose 1.1 per cent to 312.8, from January’s 309.4, according to data released from the Ratings & Valuation Department by the end of last month.
“If the market considers those picking up more than one unit as investors, then currently 30 per cent of our buyers fall into that bracket,” said Lam
The sharp rise in the number of people buying multiple homes in the one go to avoid higher levies, has put pressure on the government to introduce measures to plug the loophole.
Secretary for Transport and Housing Anthony Cheung Bing-leung early this month said the government was aware of the situation and was looking into whether these are just extreme cases or whether it has already become a general trend, Cheung told lawmakers at a Legislative Council special finance committee meeting on April 5.
Lam himself would not comment on what those prospective measures might be, adding only that it was up to the government how to better regulate the market.
K City is the second residential development offered for sale at Kai Tak after “One Kai Tak” being created by China Overseas Land & Investment.
Lam said that HK$7 billion has been earned from the sale of 740 units of the 900-unit development, at an average price of HK$20,000 per sq ft.
In December, K Wah acquired another residential site in Kai Tak through public tender for HK$5.87 billion or HK$10,220 per sq ft.
Known as Kai Tak Area 1K Site 2, it is adjacent to a piece of land bought by HNA Holding Group on December 19 for HK$5.412 billion, a record HK$13,600 per sq ft.