Buyers snap up flats at SHKP’s Cullinan West II in Hong Kong’s biggest weekend property sale in six months

Sun Hung Kai Properties (SHKP) sold all 72 units in a third round of sales at its Cullinan West II development near Sham Shui Po on Sunday as buyers took advantage of lower prices and mortgage incentives in the city’s biggest weekend property sale in six months.

On Saturday, Nan Fung Development sold more than 90 per cent of a batch of 487 flats at its LP6 project in Tseung Kwan O.

SHKP’s latest batch of apartments, with sizes ranging from 270 to 1,509 square feet, were priced between HK$22,593 per square foot and HK$33,413 per square foot, after factoring in discounts of as much as 20 per cent.

Sun Hung Kai’s low-price tactic for new flats at Cullinan West II appears to pay off

Hong Kong’s biggest developer has been lowering its prices to tempt buyers, as the city’s red hot property market shows signs of starting to cool down.

It was also offering first-time mortgages of up to 80 per cent of the flat’s value, much higher than the standard mortgage ceiling of 60 per cent of a property valued below HK$10 million (US$1.3 million), and 50 per cent for those above HK$10 million.

Before Sunday, SHKP had already sold 500 units at the project atop Nam Cheong MTR station, generating revenue of more than HK$7 billion in the past few weekends.

This weekend’s bumper property sale came as competition among developers to lock in buyers heats up before the era of cheap mortgages comes to an end.

Brokerage Nomura has become the latest to predict sharp falls in property prices in the city, the world’s least affordable housing market, forecasting a 13 per cent drop next year as higher mortgage rates bite.

Interest rates are expected to rise by the end of the month, with Hong Kong set to follow any increase by the US Federal Reserve, a move that is likely to dampen demand.

“Buying interest will drop and more buyers will take a wait-and-see attitude when the prime rate rises,” said Lung Siu-fung, analyst at China Merchants Securities International. “Developers want to sell before the prime rate rises.”

“You only have a set number of buyers. Your buyer pool is finite, so I think right now it’s giving buyers a little bit more opportunity to look around, not only in terms of product but also in terms of pricing,” said Denis Ma, head of research at JLL, referring to the keener competition to lure homebuyers.