As homebuyers wait on the sidelines, builders tempt them with special mortgage rates, cash discounts
The incentives come after residential property transactions in Hong Kong fall to a 20-month low in September
Hong Kong developers are offering cash rebates and lower mortgage rates to drum up sales after residential transactions hit a 20-month low, as rising interest rates, volatile stock market and worsening US-China trade war keep buyers on the sidelines.
Vanke Property (Hong Kong), a wholly owned unit of China Vanke, on Wednesday started offering buyers of its LePont project in Tuen Mun a lower mortgage rate, just a week after banks raised lending costs for the first time in 12 years.
Kowloon Development also said it was considering bigger mortgage loans for its soon-to-be launched One East Coast residential project, in Yau Tong.
“It shows developers want to sell fast before the market sentiment sours further,” said Lung Siu-fung, analyst at China Merchants Securities International.
Analysts also said that developers were keenly awaiting Hong Kong Chief Executive Carrie Lam Cheng Yuet-ngor’s annual policy address due this month, as she is likely to announce land reclamation plans, which might hit immediate demand.
Vanke Property (Hong Kong) has teamed up with Centaline Mortgage Broker to offer Le Pont buyers a mortgage rate of 2.275 per cent, 10 basis points lower than the standard mortgage rate of 2.375 per cent. Last Thursday 11 banks raised the prime rate by 12.5 basis points, effectively pushing up the monthly repayments on home loans.