Prices rise amid tight supply of flats as sales decrease

PUBLISHED : Tuesday, 22 July, 2014, 2:56pm
UPDATED : Wednesday, 23 July, 2014, 5:14am

Tight housing supply led to a decrease in secondary home sales in Hong Kong last week, but prices continue to rise.

Data from Ricacorp Properties showed that for the week to Sunday, 166 second-hand flats were sold in the 50 largest private housing estates it monitors, the fewest in 15 weeks and down 17 per cent from the 200 sales the previous week.

But property prices increased for the eighth consecutive week, rising 0.2 per cent last week, the agency said.

The Centa-City Leading Index from Centaline Property Agency, which tracks second-hand home prices at 100 housing estates, rose 0.01 per cent week on week to 123.36, the highest in 68 weeks. That is just short of the market peak of 123.66 in mid-March last year.

"Only housing estates on Hong Kong Island continue to record growth in sales. In Kowloon, the lack of flats available for sale and the increasing property prices have dampened buying interest," Ricacorp director David Chan said.

Sales in Kowloon dropped 28 per cent to 60 flats during the period. Major housing estates such as Harbour Place in Hung Hom, the Latitude in San Po Kong, Island Harbourview, Central Park and Park Avenue in Tai Kok Tsui did not record any sales.

Chan said home seekers in the New Territories had turned their focus to new projects, noting that prices for used homes in first-tier housing estates had climbed too high, and that Cheung Kong's Mont Vert in Tai Po would launch more sales on Saturday.

"Many home seekers will be attracted by the project. Also, the supply of small flats on the secondary market is very tight," he said.

"Even if there were flats available for sale, their asking prices would be very high. I think home sales will drop a further 20 to 30 per cent in the coming two weeks."

Since developers have only been selling the remaining flats at their new projects, sales of new homes over the weekend were quiet.

Property agents estimated that 59 flats were sold during the weekend, 74 per cent fewer than the 231 the previous week, mainly at Grand Austin and Park Ivy in West Kowloon.

Sales of New World Development's Park Signature in Yuen Long were the most active among the new projects. It sold 12 flats during the weekend.