Vanke sells all flats at Hong Kong development, defies worsening Goldman Sachs forecast for property sector
- More than 46 buyers were competing for each flat on sale at The Campton
- Home prices will fall 25 per cent from mid-2019 levels if the impact of the coronavirus lasts until the third quarter and anti-government protests intensify
Vanke Holding (Hong Kong) sold all 188 flats on sale at its The Campton development in Hong Kong’s Cheung Sha Wan area on Wednesday. The outcome defied a forecast by investment bank Goldman Sachs, which revised down its estimates for local housing prices, office and retail rents by 5 to 15 percentage points this week.
One buyer even splashed out HK$30 million (US$3.87 million) for four flats, according to Centaline Property Agency.
With 8,700 registrations of intent received, more than 46 buyers were competing for each flat on sale. The flats, a first batch, cost HK$16,411 (US$2,117) per square foot on average after discounts, the lowest price recorded in the city’s Kowloon district for four years for new projects. Vanke Holdings (Hong Kong) is held by Hong Kong-listed Vanke Overseas Investment Holding, a subsidiary of China Vanke, one of mainland China’s biggest property developers.
“Over the near term, we expect developers to take advantage of the current window of pent-up demand and hasten their pace of releasing primary units,” said Henry Mok, senior director of capital markets at JLL in Hong Kong. “Asking prices are likely to stay reasonable, with a view to reducing inventories and taking advantage of the recovering market sentiment.”
The sale went ahead despite citywide protests against a proposed national security law and the controversial National Anthem bill. In fact, two police officers visited the sales venue in Tsim Sha Tsui and even questioned the staff in the morning.
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A young buyer, who only gave his surname as Yeung, said he was worried the national security law would dampen the housing market sentiment. But in the long term, “cash will depreciate” while housing will still see strong demand, he said, explaining his decision to buy a two-bedroom flat for HK$6 million for leasing purposes. He said The Campton was cheaper than other new projects.