Hong Kong property

Sun Hung Kai to offer 90pc mortgages for high income groups at Lohas Park project

In what’s believed to be an industry first, Sun Hung Kai Properties will offer aggressive mortgage financing targeting urban professionals

PUBLISHED : Wednesday, 20 September, 2017, 8:31am
UPDATED : Wednesday, 20 September, 2017, 12:57pm

Sun Hung Kai Properties (SHKP) offered an array of financing schemes to draw potential buyers for its new project in Tseung Kwan O on Tuesday, including first mortgages of up to 90 per cent to “designated customers” such as doctors, dentists, lawyers and accountants.

According to the developer, the 90 per cent loan-to-value ratio for buyers of Wings at Sea in Lohas Park, will also extend to surveyors, veterinary surgeons, registered nurses, actuaries, chartered financial analysts, airline pilots, and Hospital Authority staff and civil servants who earn a monthly salary of at least HK$63,095.

In addition, buyers who opt for the “King’s Key Star” scheme will receive a three-year mortgage equivalent to 120 per cent of the flat’s value without the need to submit income proof. The 120 per cent finance plan applies to buyers who already own a flat.

The financing plan is much higher than the standard mortgage ceiling of 60 per cent for flats below HK$10 million, and 50 per cent for those more than HK$10 million.

“It is my first time to hear about such a scheme for professionals. The special financing scheme will accelerate buying demand from these high income groups,” said Denis Ma, head of research at JLL.

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He said these professionals have the ability to pay the monthly instalments but may not have enough saved up to put a down payment of as much as 50 per cent for flats worth HK$10 million.

The financing suggests the developer is eager to accelerate sales ahead Chief Executive Carrie Lam Cheng Yuet-ngor’s maiden Policy Speech next month, when she is expected to unveil details of the “Starter Home” scheme.

The policy proposal was discussed during her campaign as part of a pledge to help young families who cannot not afford private housing but earned too much to qualify for affordable housing.

Market experts believe the “Starter Home” scheme could help be structured to aid families with incomes ranging from HK$52,000 to HK$72,000 per month.

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Victor Lui, deputy managing director at SHKP said the average price of the 208 units is HK$12,788 per square foot after factoring in discounts of as much as 18 per cent.

The first batch of 208 units, in sizes ranging from 340 sq ft to 700 sq ft, were priced between HK$4.29 million to HK$9 million.

The prices were about 15 per cent higher than the secondary market at HK$11,114 per sq ft, according to Centaline Propery Agency.

Sammy Po, chief executive of Midland Realty said the risk of default for these high income groups was relatively low.

“With higher loan-to-value ratios, it will encourage them to buy flats with bigger lump sum amounts,” he said.

MTR Corp awarded the site to SHKP in 2014 at an estimated land premium of HK$2.71 billion, or HK$2,059 per sq ft.