Chuang’s China Investments sells only 35 per cent of units in Tuen Mun development
- Four of the apartments on sale cost less than HK$3 million
A two-day property sale that kicked off in Hong Kong failed to draw the crowds on Thursday. Only about 35 per cent of apartments on offer by Chuang’s China Investments in Tuen Mun had sold by 5pm.
Only 62 units were sold seven hours after the sale started, according to market sources, while in the morning, during “priority sales” for buyers of more than two units, no sales were recorded.
“The result is not good. There were a lot of cheap flats [available] but not many buyers sealed deals today,” said Sammy Po, chief executive of Midland Realty’s residential department. Po said he did not expect sales of more than 70 units by the end of business on Thursday.
Chuang’s China Investments has put 175 units out of a total of 371 apartments at The Esplanade, a 20-minute walk from the Tuen Mun MTR station, on sale, at prices starting from HK$2.88 million or HK$17,832 per square foot. Four of the apartments on sale cost less than HK$3 million.
The developer may report the sale of 40 per cent of the units on sale on Thursday. Two months ago, this figure could have reached more than 90 per cent.
China Vanke reported the sale of 58.3 per cent of units at its Le Pont development on the first day, at the beginning of October. Sun Hung Kai Properties sold about 350 units, or 96 per cent, out of a tranche of 364 units at its Cullinan West II project in Kowloon on August 26.
Buyers are no longer rushing to queue for apartments any more as they now know developers will not raise prices in the short term. “Amid such soured sentiment, developers will not dare to raise prices one price list after another, as they used to do,” said Derek Chan, head of research at Ricacorp Properties.
Originally, 817 units were to go on sale this week, but the tender sale for The Horizon development by Billion Development and Project Management, which was to release 138 apartments in Tai Po, was pushed back to Monday, and will now close on November 9.
Market observers have said fierce competition between developers selling at the same time will make it even more difficult for them to find buyers, whose interest in home purchases has been dented by factors that include rising mortgage rates, a falling stock market and the impact of the US-China trade war.
The sales of homes in Hong Kong have slowed down over the past couple of weeks. According to data by Centaline Property, only 800 new apartments had been sold by Thursday. When estimates for Thursday and Friday are included, the sale of only 1,300 units is expected against the agency’s forecast of 2,000 deals. By comparison, 1,997 new apartments were sold in September.
Hong Kong developer Chinachem City has said it will put 504 units, or 70 per cent, of its Sol City project in Yuen Long up for sale on Friday.
The city’s Rating and Valuation Index, which tracks the prices of used homes, dropped to 393.9 in August, down by 0.3 points from a month earlier, ending a 28-month rising spree. Elsewhere, Citibank, UBS and Nomura have issued warnings that a long-standing uptrend in home prices could grind to a halt and head the other way.