Developers target holiday buyers with 3 new projects

Discounts at three new projects are unlikely amid tight housing supply in neighbouring areas and strong demand for small flats

PUBLISHED : Tuesday, 29 April, 2014, 3:28pm
UPDATED : Wednesday, 30 April, 2014, 2:08am

Three developers have been rushing to release their new residential projects for sale during the "golden week" national holiday starting on Thursday to absorb pent-up demand.

Henderson Land Development's Harbour Pinnacle in Tsim Sha Tsui, Cheung Kong's City Point in Tsuen Wan and Kowloon Development's MacPherson Place in Mong Kok could supply a total of 2,272 flats to the market.

Demand for new homes is still squeezed as a result of the government's cooling measures.

However, analysts said the developers would not cut prices to lure buyers as the three projects were not in districts with plenty of new housing supply.

According to the developer's website, asking prices for the first batch of 22 flats at the 262-unit Harbour Pinnacle, which is targeted at investors and wealthy buyers, range between HK$13.95 million and HK$22.84 million for units measuring 359 to 689 square feet, or HK$29,484 to HK$41,721 per square foot.

On Monday, the developer began to accept buyers to reserve flats based on another price list. Agents said the prices were above market expectations, which attracted only two interested parties. It forced Henderson to postpone sales on Monday night.

The other two projects are targeted at end-users.

City Point, next to Waterside Plaza, provides 1,717 flats with two- to four-bedroom designs. Prices at the nearby Vision City range between HK$9,000 and HK$12,000 per square foot.

As Cheung Kong planned to sell only 800 flats at City Point this year, they would not be priced too low, Bocom International analyst Alfred Lau said.

"You can see that developers have offered fewer discounts recently. They would rather sell the flats gradually after they sell out the first batch," he said.

MacPherson Place, next to Macpherson Playground, provides 293 flats sized between 293 and 1,803 sqft.

Sammy Po Siu-ming, chief executive of Midland Realty, said: "New projects in the New Territories would be offered at a higher discount as there will be plenty of new supply. But it would be different for those in the urban area as future supply is tight."

He expected asking prices at City Point and MacPherson Place to be similar to market prices.

Po said housing demand mainly came from end-users, including upgraders.

"The demand for small flats is strong. And we see more investors coming back to the market. They plan to buy flats to lease out," he said.

"There are more mainland buyers as well. Only a few mainlanders bought flats at new projects in the third quarter of last year, compared with previously, when they made up 20 per cent of buyers.

"If developers continue to offer a subsidy to offset the buyer's stamp duty, the projects will attract more mainland buyers."

Patrick Chow Moon-kit, head of research at Ricacorp Properties, said sales of new flats this year would be better than last year as developers would be more active in selling new projects.

He expects about 16,000 new flats to be released on the market this year with sales reaching 14,000.