Yuen Long to see largest supply of new flats in Hong Kong this year
More than half the flats from 11 new projects are located in Yuen Long, with developers expected to cut prices to lure buyers
Yuen Long will be the area providing the largest supply of new flats this year, suggesting that developers will adopt a low price strategy to compete for budget buyers who will have an array of choices.
Last week, Sun Hung Kai Properties (SHKP) kicked off the pre-sale of the area’s first mass residential project after the Chinese New Year at a lower than expected price in order to compete for buyers.
Eleven new projects – comprising a total of nearly 4,200 flats – are slated to be released in coming months.
More than half of those, or 2,600 flats, are located in Yuen Long, according to Ricacorp Properties.
“The secondary residential markets in Yuen Long and Tuen Mun have been frozen since the SHKP project launch. Most agents are focusing on the primary market rather than secondary market in view of the large supply in coming months,” said Leslie Lit, a sales manager at Centaline Property Agency’s Yuen Long branch.
He expects no overall improvement in the secondary residential market as individual owners would have difficultly competing with developers’ low prices and preferential financial schemes to facilitate sales.
SHKP released the first batch of 108 units at Twin Regency in Yuen Long at an average of HK$11,360 per square foot, about 15 per cent lower than Cheung Kong Property’s Yucci Square launched in the same district in November last year.
After factoring in an 11 per cent discount, the selling price of Twin Regency was HK$10,138 per square foot. The cheapest one is a 299 square feet flat costing HK$2.8 million, or HK$9,372 per square foot.
On top of attractive prices, SHKP will also provide a home loan of up to 80 per cent of the flat’s value with a 25 year tenure through its own financial institution.
The interest rate for the first two years will be based on HSBC’s best lending rate minus 2.25 per cent, and prime minus one per cent from the third year.
Lit said the selling price at Twin Regency was about 20 per cent lower than current secondary transaction prices.
“The developer’s financial scheme is also tailor made for first time buyers who cannot fork out the 30 per cent initial down payment. But with the help of the scheme, it will offer a financial relief for them,” he said.
In coming months, he expects sales in the secondary market in Yuen Long would remain sluggish.
Twin Regency, located at 11 Tak Yip Street and about eight minutes walk to West Rail’s Long Ping Station, comprises 523 units, with the first batch ranging from 299 square feet to 423 square feet in size. The project is due to be completed in July 2017.
SHKP’s other major projects to go up for sale shortly in Yuen Long include the 1,114-unit Grand Yoho and 665-unit Park Vista phase 1B and 1C development; and the 912-unit The Spectra, a joint development between Sino Land and K Wah International.