Hong Kong property

Buyers snap up 96pc of units on offer in first round sale at luxury North Point development

PUBLISHED : Wednesday, 06 June, 2018, 6:33pm
UPDATED : Wednesday, 06 June, 2018, 11:00pm

A luxury residential development in North Point drew a strong response from buyers on Wednesday, with more than 230 units snapped up, or 96 per cent of available stock, reflecting continuing strong momentum in the property market.

Of the 247 units on offer at New World Development’s Fleur Pavilia, 237 were sold as of 8.30pm on Wednesday as buyers thronged the developer’s Tsuen Wan sales centre, with the cheapest flat on offer for HK$19.5 million (US$2.49 million).

“We’ve seen a positive response. Those units that remain unsold are large, costing more than HK$50 million,” said Sammy Po Siu-ming, chief executive of the residential division at Midland Realty.

The sale will continue until midnight.

“The location is good and 70 per cent of buyers are acquiring flats for their own use,” he said.

The rental in the neighbourhood is about HK$70 to HK$80 per square foot per month, and the houses can fetch a rental yield of 3.5 per cent, he said.

A client of Midland plans to pay HK$70 million to buy three three-bed room units.

New World Development said it pulled in revenue of HK$5.8 billion from the sale of the 237 units. Agents said it was the highest in terms of value for the first-day sale of a new project since 2013.

Located on Kai Yuen Street in North Point, Fleur Pavilia will feature 611 units, mainly configured as three-and four-bedrooms. The smallest flat on offer Wednesday was 781 sq ft, while the largest was 1,537 sq ft. The prices ranged from HK$19.5 million to HK$56 million after discounts.

Wednesday’s sale drew 1,800 bids at registration, more than seven times the 247 units offered by New World Development.

The sale reflects continuing buoyant conditions for the property market, even as some analysts cautioned of shifting marketing conditions amid higher interest rates.

The developer, seeing the enthusiasm among prospective buyers, released another 100 units on the fourth price list on Tuesday.

The average price after discounts of the newly released 100 units was HK$30,842 per sq ft, 10 per cent higher than the average HK$28,032 per sq ft on the first price list released on May 29.

Unit A on the 30th floor in Block One was listed at HK$58.7 million, nearly 15 per cent higher than the price of unit A on the 29th floor in the same block on the first price list.

“We are confident in the sales today [Wednesday] and will continue to release another 100 units in the coming one to two days,” said Akan Wong, general manager of sales and marketing at New World Development. “And we expect to increase the price by 3 per cent to 5 per cent.”

Property prices in Hong Kong, the world’s most expensive urban centre, have continued rising for 25 consecutive months through April.

“Home prices have climbed to a very high level. As interest rates are widely expect to enter an uptrend cycle in the second half this year, the property sector is likely to be exposed to higher risk,” said Alfred Lau, a property analyst at Bocom International.

Hong Kong developers resume buying land in mainland China after five-year hiatus

The average cost of a new home in the city has reached HK$14.5 million, 12 per cent higher than HK$12.97 million in 2017, according to Midland Realty’s data.

Midland forecasts that more than 2,000 new home sales will be completed in June.

Completion of the project is expected in September.