Hong Kong buyers flock to Lohas Park apartment sale despite 19.9 per cent increase in asking price
More than half of units at Malibu complex developed by Wheelock Properties sold by 7pm on the first day of Easter Holiday
Hundreds of prospective homebuyers shrugged aside a 19.9 per cent increase in prices – and imminent increase in interest rates – and turned up at the sale of a residential development in Lohas Park on Friday.
More than half, or 64 out of 111 units, at Malibu, which has been developed by Wheelock Properties, had been sold by 7pm on the first day of the Easter Holiday, with the sale still ongoing.
Wheelock has fetched HK$12.89 billion (US$1.64 billion) in revenue from the sale of 1,440 units, or 96 per cent of all the 1,501 units released. After this latest batch, the company said it had sold 1,376 units.
“The sales are reasonable, as it is already the sixth batch and the prices have gone up,” said Sammy Po Siu-ming, the chief executive of Midland Realty’s residential division. “It is impossible to be sold out on the first day every time.”
The cheapest flat sold today was a 459 sq ft, two-bedroom unit, which fetched HK$7.8 million after discounts. The highest recorded price today was HK$18.96 million after discounts, for a 1,087 sq ft unit, according to data by Midland Realty, as of 6.30pm on Friday.
Wheelock released the latest batch of 111 units at an average discounted price of HK$17,203 per square foot, according to Po. The price is 19.9 per cent higher than launch prices quoted earlier this month.
The buyers rushed to get ahead of an expected increase in mortgage rates, with some arriving half an hour earlier and queuing up outside the sales centre.
“I have taken part in bidding five times, and finally got a flat this time,” said Chan, 30, who paid HK$8 million for a two-bedroom flat for his own use. “I earned the down payment over 10 years.”
Centaline Property Agency said there were potential buyers aiming to buy two flats with HK$30 million; Midland Realty also said some buyers were seeking to buy two flats and had arrived with HK$25 million.
“About 90 per cent of those who joined the bidding this time were those who had failed to get an apartment from the early batches,” said Midland Realty’s Po. “They would like to have the chance to join the currently available mortgage package before a possible increase in interest rates.”
The Malibu sale is the property sector’s first since the US Federal Reserve raised interest rates by 25 basis points to 2 per cent this month, prompting Hong Kong’s monetary authority to do the same.
“As long as the interest rate does not rise sharply, the impact on the market will be limited,” said Thomas Lam, a senior director at Knight Frank in Hong Kong. He said that only if the interest rate increased by 1.5 to 2 basis points, will the property market feel a downward pressure.
“Developers have accelerated the marketing of news flats this year, and the government policy is also in favour of the first-hand market. As long as the price is reasonable with attractive discounts, new flats will be a hit this year,” said Lam.
Midland Realty’s Po said he expected to see 170 transactions in the first-hand market during the Easter Holiday, the highest in three years, so that a total of 2,300 transactions can be booked for March and 2,500 for April, pushed up by new launches.
The Malibu complex will have 1,600 flats.