Micro flats, once all the rage in Hong Kong because of their affordability, would bear the brunt of the city’s property price slump, said an executive of CK Asset Holdings, one of the city’s biggest developers. Executive director Justin Chiu Kwok-hung forecast that prices for tiny flats could tumble as much as 30 per cent next year as demand dries up. Chiu said “in his personal view” that prices of such units, with a size of less than 200 square feet or smaller than a car park space, would suffer most because growth of the segment had saturated, with more than 10,000 tiny flats “digested”, or sold. In addition to units in the sales pipeline for 2019, Chiu estimated that the supply of these “shoebox” sized flats could total as many as 20,000, weighing on their prices. ‘Micro’ homes at T-Plus in Tuen Mun priced at levels last seen in 2016 Across the broader residential property market, prices would fall between 10 to 20 per cent depending on the location and the available supply in each district, he said, which made him the most bearish major Hong Kong developer to date. Rivals like Chinachem had predicted a decline of within 10 per cent while Sun Hung Kai Properties said buying sentiment would pick up next year. Prices of lived-in homes in Hong Kong saw a sharper decline in October as sentiment was hurt by the trade war, slump in stock markets and uptrend in interest rates. The decline has compelled developers to launch new projects at discounts. The latest being Sino Land, which is selling the first batch of 205 units of its Grand Central development in Kwun Tong district, eastern Kowloon, at an average price of HK$17,388 (US$2,225) per square foot, 14 per cent less than the price of lived-in flats in the neighbourhood. The units of the 1999-unit development would cost between HK$7.33 million to HK$15.9 million after the discount, lower than Sino Land’s earlier expectations of securing a price level of around HK$20,300 per sq ft, similar to that of properties in the former Hong Kong airport site Kai Tak. In October, the city’s Rating and Valuation Index, which tracks home prices, dropped 2.4 per cent. That means home prices have slumped 3.6 per cent in total after peaking in July following a 28-month rally starting in April 2016. Hong Kong home prices accelerate their fall Alvin Cheung, associate director at Prudential Brokerage said Chiu’s view, to a certain extent, reflected CK Asset’s take on the city’s property market outlook. “CK Asset’s land bank is relatively small compared with other major developers, and it has been selling down its flats at a fast pace before the market turned sour,” said Cheung. The developer, headed by Victor Li Tzar-kuoi, the eldest son of Hong Kong’s richest man Li Ka-shing, owns five million sq ft of land bank for development in the city, according to its interim result announcement in August. But that volume has expanded after it won the tender for the phase three development site of the Wong Chuk Hang MTR station, which will yield a total gross floor area of 1.5 million sq ft, developed into four residential towers with a total of 1,200 flats and a 505,908 sq ft shopping centre. By comparison, Sun Hung Kai Properties and Henderson Land hold 21.4 million sq ft and 14 million sq ft respectively.