Country Garden’s housing project underwhelms in Hong Kong sales debut, even after discounts
- China’s largest developer by sales said it had sold 18 of 110 units on offer at the project by 10.20pm on Monday, nearly four hours into the sales drive
Country Garden Holdings has struggled to drum up buyer interest in its first ever foray into the Hong Kong residential real estate market, even as the developer priced the units 5 per cent lower than other projects in the same neighbourhood launched earlier this year.
China’s largest developer by sales said it had sold 18 of 110 units on offer at the Altissimo in Ma On Shan as of 10.20pm on Monday. The sale at the 547-unit development kicked off at 6.30pm on Monday.
The average selling price was HK$16,497 per square foot, 5 per cent lower than the average HK$17,380 per sq ft price in July at the nearby St Martin, developed by Sun Hung Kai Properties.
Some units at lower floors were going for less than HK$15,000 per sq ft. For instance, a 876 sq ft flat on the first floor cost HK$13,887 per sq ft, or HK$12.16 million after discounts. A 312 sq ft flat sold for HK$4.98 million after discounts.
Some buyers took advantage of flexible mortgage options with a payment period of up to 500 days.
“It is the new normal that only a small ratio of flats could be snapped by buyers as most are afraid to make any move and are taking a wait-and-see approach,” said Midland Realty’s residential division chief executive Sammy Po Siu-ming.
On Saturday, only three out of 150 units were sold at The Esplanade project in Tuen Mun, a project by Hong Kong-listed developer Chuang’s China Investments.
On November 17, The Reach Summit project in Yuen Long, jointly built by Henderson Land Development and New World Development, sold six of 102 units on offer.
In another weekend sale, MCC Real Estate Group sold five of 50 units on offer at its L’aquatique project in Tsuen Wan.
Midland Realty has forecast 400 sales of new private homes in November, only a third of the number sold in October.
The combination of a government proposal to tax vacant flats – a way to encourage developers to put more properties on the market – and the first rise in mortgage rates in the city in a decade, has had a chilling effect on the city’s housing market.
Median prices rose for 28 consecutive months until August, but have fallen 4 per cent in the past eight weeks.
They could fall by up to 15 per cent in the next 12 to 18 months, according to Moody’s Investors Service, the latest financial institution to forecast a fall in home prices in the coming year.
The uncertainty over the outcome of the US-China trade war has added to the gloom in the market.
In September last year Country Garden paid Wang On Properties HK$2.44 billion, or HK$10,500 per sq ft, for a 60 per cent stake in the 387,500 sq ft Altissimo project.