Hong Kong buyers snap up a quarter of flats in ‘youth oriented’ project in Yau Tong on Friday
About a quarter of the flats at a development targeted towards young and first-time buyers in Yau Tong, Kowloon were snapped up late Friday, a modest result after a tumultuous week for local asset prices amid concerns that Hong Kong will not be immune to fallout from the worsening China-US trade war.
About 32 flats of the 130 offered were sold as of 10pm at One East Coast, by Kowloon Development.
In addition, three of 32 units on offer by tender were sold as of late Friday.
“Only a bit over half of our clients registered showed up today,” said Midland Realty’s Sammy Po. “By tonight, around 60 to 70 units could be sold. Sales results cannot be compared with those a couple of months ago. The market has been dominated by headwinds such as the US-China trade war, rising interest rates and launch of the Home Ownership Scheme flats at heavy discounts.”
The units ranged from 201 square feet to 374 sq ft and are priced between HK$3.9 million and HK$7.7 million (US$497,741 to US$982,695), with an average price of HK$19,913 per sq ft after discounts.
Ten of the units are priced under HK$4 million, which means buyers are allowed a loan-to-value mortgage of 90 per cent and only need HK$400,000 for down payment.
On Wednesday, Chief Executive Carrie Lam Cheng Yuet-ngor announced a reclamation-heavy plan of building artificial islands to ease Hong Kong’s housing crisis.
The “Lantau Tomorrow Vision”, lays out a strategy to develop the islands located to the east of Lantau Island, the city’s largest island during the policy address.
Estimated to be 1,700 hectares in size, the massive reclamation project would provide 400,000 flats to house 1.1 million people, and Lam pledged to reserve 70 per cent of flats for public housing.
“This would particularly impact potential buyers looking at small sized flats. Now more of them may like to wait for the government’s subsidised flats that are at similar size, but much cheaper,” said Derek Chan, head of research at Ricacorp Properties.
The property agency expects overall home prices will retreat by 3 per cent to 5 per cent through December compared to the prior quarter.
The city’s Rating and Valuation Index, which tracks prices of used homes, dropped to 393.9 in September, down 0.3 point from a month earlier, ending a 28-month long increase.
Last weekend, buyers took up 181 of 310 flats offered at Le Pont, a project by Vanke Property (Hong Kong) in Tuen Mun, despite incentives that included discounted mortgage rates and cash rebates.