Hongkongers snub second property sale in as many days, as MTR’s South Land becomes looming Fed rate hike’s latest victim
- South Land, a project developed by RK Properties and MTR Corporation in Wong Chuk Hang, fails to sell a single unit two days before expected Fed rate hike
- Only two out of 139 units were sold at Miami Quay in Kai Tak on Sunday
Hongkongers appeared to have been spooked by a looming increase in interest rates, as they snubbed another property sale in the space of two days.
“Everyone is waiting to see by how much the Fed is going to increase its interest rates. People are more cautious and are taking a wait-and-see approach,” said Sammy Po, CEO of Midland Realty’s residential division for Hong Kong and Macau. “Many homebuyers are still undecided, which is why transaction volumes are relatively poor.”
The flats on offer at South Land have an average price of HK$35,804 (US$4,561) per square foot, with the most expensive unit priced at about HK$62 million and the cheapest at about HK$11 million, according to the property’s price list. The flats range in size from 290 sq ft to 2,083 sq ft and in layouts from studios to four-bedroom units.
South Land is the first project to sit atop a major subway station in about three decades. It was first launched in May last year, when its initial three rounds of sales were sold out.
The latest round of sales at the development comes amid a less accommodating economic landscape.
Home prices in Hong Kong have declined by about 5 per cent as of August, according to Cushman & Wakefield. The consultancy said that for the entire year, home prices will fall by as much as 8 per cent, while transactions are likely to slump by 35 per cent.
A potential full reopening of Hong Kong’s borders might have drawn a muted response from buyers, but it can only benefit the property industry, as it would expand the pool of tenants and investors in the local market, said Martin Wong, director and head of research and consultancy, Greater China, at Knight Frank.
“This will potentially lead to a rebound in property prices.”