Developer China Vanke’s Hong Kong unit sets prices for Ho Man Tin project 3 per cent above secondary market

First batch of 50 units at Vau Residence will be offered at an average price of HK$24,519 per square foot after a discount of as much as 16 per cent
Vanke will also offer cash rewards to the first 50 fully vaccinated buyers

Hong Kong property

Sandy Li

Published: 7:30am, 11 Jun 2021

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Vanke Holdings (Hong Kong), a unit of China Vanke, China’s third-largest developer, will launch a new residential project in Ho Man Tin at prices in line with those of the secondary market.

The price list for a first batch of 50 units measuring 209 sq ft to 388 sq ft at Vau Residence was launched on Thursday. The units will be offered at an average price of HK$24,519 (US$3,160) per square foot after factoring in a discount of as much as 16 per cent. Vanke has not announced a starting date for the sales yet. The development will have 165 units in total.

The prices announced on Thursday are 3 per cent higher than those of units at Seven Victory Avenue, a two-year-old development that is within walking distance of Vau Residence. The units at Seven Victory Avenue were selling for HK$23,820 per square foot, according listings on Centaline Property Agency’s website.

“It is common practice for developers to offer their first batch of units at competitive prices, to draw buying interest. Builders will increase prices for the subsequent batches, once they have generated strong sales,” said Sammy Po, chief executive of Midland Realty’s residential section.

The price list’s launch comes amid growing optimism that Hong Kong home prices will climb further this year as the city’s economy shows further signs of recovery. On Tuesday, US investment bank Goldman Sachs said it expected a 5 per cent rise in home prices this year, while Shih Wing-ching, Centaline’s founder, has forecast a 15 per cent increase.

“The launch prices have taken into reference the first and second-hand transaction market. We will not rule out the possibility of increasing prices for the following batches,” said Quincy Chow, Vanke Holdings (Hong Kong)’s executive director.

The strategy of raising prices for subsequent batches has been adopted by Hong Kong property company New World Development (NWD). After all 331 units at its Pavilia Farm III next to Tai Wai Station were sold on their first day of sales last weekend, NWD has raised prices for the second batch of 388 units to HK$22,600 per square foot, a 13 per cent increase over the launch price of HK$19,999 per square foot offered about a week ago. The second batch goes on sale this Saturday.

Vau Residence would attract both end users and investors, Po said. “We have seen a sharp rise in home sales in the primary and secondary markets. It reflects buying confidence, which has been boosted by the gradual improvement in economic activity. The reopening of the border later is bound to enhance the sales momentum, when more mainland Chinese are free to visit Hong Kong,” he said.

Vanke will also offer a cash reward of HK$28,000 to each of the first 50 Vau Residence buyers who have had their Covid-19 vaccinations before August 31. Vanke said it expects the cash reward will cost it about HK$1.4 million in total.

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