New World Development offers Hong Kong’s young homebuyers a leg-up with new scheme
The developer offers down payments of just 7.5 per cent on units at its Tuen Mun project – but prices still start at an eye-watering HK$7.44 million
New World Development has unveiled a new programme aimed at helping young people in Hong Kong onto the housing ladder by offering initial down payments as low as 7.5 per cent.
The company said home-seekers aged between 25 and 35, who are permanent residents and have never owned property in Hong Kong, can apply for the scheme, called the NewGen First Home Program.
As a test case, the developer is inviting applications for 15 flats at The Parkville residential development in Tuen Mun.
On Monday, New World released the price list for the first 65 units of the project in the new town in New Territories West. They range from HK$7.44 million to HK$15.13 million, with sizes from 422 square feet to 853 sq ft.
The NewGen programme was unveiled by the company’s vice-chairman Adrian Cheng Chi-kong, who had said in September that graduates from the eight universities in Hong Kong who earn a stable income after two to three years of work would be eligible.
The detailed plan announced has removed the requirement that applicants be university graduates.
Interested parties can apply for their unit under their own name or purchase it in joint ownership with one or more eligible buyers, according to a spokeswoman for New World Development.
A down payment of as little as 7.5 per cent of the purchase price is designed to enable applicants to take an easier first step onto Hong Kong’s notoriously steep property ladder. For example, approved applicants are required to pay a HK$558,000 down payment for a HK$7.44 million flat at The Parkville.
Hong Kong has consistently topped surveys of the world’s most expensive housing markets for several years now.
At present, homebuyers can get a loan of 80 per cent of the property’s value under the Hong Kong Mortgage Insurance scheme for flats priced between HK$4 million and HK$6 million. That means buyers are required to put down an initial deposit of HK$1 million for homes costing HK$5 million.
New World also announced a new progressive mortgage repayment arrangement, in which a 10-30 per cent discount on the original monthly mortgage instalment will be offered for the first 10 years.
The developer said it will also alleviate approved applicants’ stamp-duty payments, capping it at a maximum rate of 3.75 per cent of the property value.
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To prevent speculation, transfer of ownership or tenancy of the property concerned is not allowed for the first five years.
If applicants are able to make early repayment at or above HK$50,000 each time, they will be entitled to a 1 per cent extra repayment allowance without any penalty.