Developers set to launch 2,000 units to cash in on rosy sentiment

2,000 homes in HK projects ready for launch, but agent cautions sweeteners have inflated sales

PUBLISHED : Wednesday, 15 January, 2014, 5:33am
UPDATED : Wednesday, 15 January, 2014, 5:33am

Sales of at least seven residential projects, comprising some 2,000 homes, are set to be launched to take advantage of an upturn in the new-homes market.

Agents said the developers had been encouraged by the sale of more than 430 homes at the weekend, more than twice the 202 sold the previous weekend.

But that strong result was largely because developers offered discounts and stamp duty subsidies, cautioned Perry Fong, principal sales director at Centaline Property Agency. He said buyers would expect more of the same.

"Potential buyers have been spoiled by all sorts of sweeteners and it is proving to be increasingly difficult for developers to lure them without extending special offers," he said. Neither investors nor genuine homebuyers were likely to enter the market if developers launched the projects at aggressive prices.

Projects in the pipeline for re-launch include the Riva in xTuen Mun, where 778 flats are on offer, and the first phase of The Avenue in Wan Chai, where 179 flats are on offer. Sino Land posted sales brochures for The Avenue on the government website on Monday.

Henderson Land will today offer 176 flats at Double Cove in Ma On Shan and on Friday Hang Lung will offer 20 flats at The Long Beach in Tai Kok Tsui. Three luxury flats, priced at HK$73 million and HK$139 million, at 39 Conduit Road, Mid-Levels, will be offered by Henderson Land, and Swire Properties will release 12 flats at Dunbar Place in Ho Man Tin.

Sun Hung Kai Properties and Shun Tak will release the remaining 31 flats at Chatham Gate in Hung Hom on Saturday.

Taking Cheung Kong's 1,350-flat Mont Vest development in Tai Po into account, 2,000 homes will be released for sale before the Lunar New Year holiday.

Patrick Chow Moon-kit, head of research at Ricacorp Properties, said developers were hoping to ride on positive market sentiment to bolster sales.

"The market will become quiet again when the Chinese New Year break starts from January 31. So developers need to accelerate their launches," he said.

Centaline's Fong said developers aimed to cash in by adopting fast-turnover strategies to finance site acquisitions given that land prices were now falling.

Centaline Property Agency data shows the number of new-flat sales rose 150 per cent year on year in the last quarter to 3,880, with their value jumping 270 per cent to HK$41.2 billion, the biggest quarterly total in more than four years.

Despite the sharp rise, Centaline estimates just 9,753 new homes were sold last year, the lowest total in seven years. It estimates the total transaction value dropped to a five-year low of HK$92.2 billion.