Q & A with our experts, March 27, 2013
Q: I planned to buy a flat. I heard that buyers have to face a tougher stress test under the new cooling measures released by the government. I'm wondering how it affects my purchase plan.
Yes, it would affect the loan you can obtain. For example, you need to afford a down payment of 30 per cent or HK$2.1 million if you bought a flat worth HK$7 million previously. But now you may need to afford a down payment of HK$3.5 million as you could get only a 50 per cent mortgage from the bank.
Even if you planned to sell your flat and buy a new one, the money would not be enough for you to buy a new one as you have to afford a higher down payment.
If you are keen to sell your flat in the next few months, you should cut the asking price to less than HK$6.3 million. Home seekers have adopted a wait-and-see attitude and you have to lower your price to attract them. Most of the flats sold recently have been at lower prices than the previous transactions. Flats at City One Shatin were sold for 5 to 10 per cent less than similar flats sold previously. Unless your flat is outstanding, your asking price has to be lower.
New flats in the Nanshan district are selling for about 35,000 yuan per square metre on average, while secondary homes are priced at around 30,000 yuan per square metre on average. In other neighbouring areas such as Houhai, to the southeast of Qianhai, new flats cost from 45,000 to 50,000 yuan per square metre. The new flats in Central District in Baoan, north of Qianhai, are selling for about 25,000 yuan per square metre. There are not many commercial properties in the area at the moment but a recent sale of grade A office space in the district was priced at around 45,000 to 50,000 yuan per square metre.
