Hong Kong property

Hong Kong’s latest nano flats prove popular despite HK$3m price tag

PUBLISHED : Sunday, 06 August, 2017, 7:41pm
UPDATED : Sunday, 06 August, 2017, 10:49pm

A new real estate development offering nano-sized flats in Mong Kok sold all of its units on Sunday despite the parking-space-sized apartments costing nearly HK$3 million.

The first batch of 98 units offered from 10am Sunday were all sold by the evening, according to figures obtained by the South China Morning Post.

The Novi development featuring 138, one-room flats, with saleable areas between 157 and 312 sq ft, attracted more than 1,200 prospective buyers to register prior to the sale.

Developed by Lai Sun Group, the smallest apartment at the 25-storey Novi in Mong Kok is a 157 sq ft flat on the 2nd floor, which includes a 38 sq ft terrace, being offered for HK$3.06 million.

After factoring in a discount of 9 per cent, the unit’s price will come down to 17,788 per sq ft, or HK$2.79 million – the cheapest flat offered in the project.

Many buyers were young and came to the sales office with their parents, according to Sammy Po Siu-ming, residential chief executive of Midland Realty. He estimated that 30 per cent of the Novi buyers were investors, not end-users.

Tuen Mun’s ‘nano flats’, smaller than standard car parking lots, command outsize rents

“About 60 per cent of the buyers were born after 1980, with a half of them needing certain help from their parents to fund the downpayment,” Po said.

The strong sales results were in contrast to a Citibank survey released in late July which indicated only one out of 100 Hong Kong people considered the second-half of this year a good time to buy homes in the city. That’s despite more than half, or 57 per cent of the respondents, still expecting home prices to rise in Hong Kong.

Local developers are offering the smallest flats they can because sky-high home prices in Hong Kong have greatly stymied purchasing power in the city. The flood of lower-priced nano flats onto the market seems to support the continued demand for new flats.

Separately, first-time buyers in Hong Kong struggling with sky-rocketing prices can borrow more money by securing an 85 to 90 per cent mortgage loan through Hong Kong Mortgage Corp’s mortgage insurance for units costing below HK$4 million.

Buyers of Novi units need only come up with an initial deposit of HK$280,000, or 10 per cent of the cost of the smallest 157 sq ft flat in Novi, compared with the 40 per cent down payment for flats costing more than HK$7 million.