Hong Kong’s cheapest homes since 2014 have gone on sale – with one apartment on offer for HK$958,000 (US$122,322) – in Yuen Long in the city’s New Territories.

Man Wai-hong, a member of one of the four clans in the area, will on Thursday put three apartments up for sale in Wah On Villa, a village house development. The properties range from 603 sq ft to 746 sq ft in size, and will be offered for HK$958,000 to HK$1.62 million, according to the development’s website.

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“It is rare [to see homes sold at less than HK$1 million],” said Lee Shu-kam, associate professor of economics and finance at Hong Kong Shue Yan University. “There will be more [such cheap apartments].”

Lee said the emergence of such cheap apartments was down to the government’s recent housing subsidies, such as the Home Ownership Scheme, which was passed last Friday and will offer homes for as low as 42 per cent of market price. The scheme will create more choices for homebuyers looking for relatively cheap apartments, so the demand for expensive small apartments will shrink and the prices of these properties will also need to trimmed for them to be competitive.

The Wah On Villa apartments are a 15-minute minibus ride away from the MTR station in Yuen Long. The cheapest of the three properties is on the first floor, has an area of 735 sq ft along with a 132 sq ft balcony, and will be offered for HK$958,000, or HK$1,303 per square foot, on par with the project’s first launch price in 2014. It has three bedrooms.

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As the flats cost less than HK$4 million, first-time homebuyers can apply for mortgage insurance enabling a 90 per cent loan-to-value ratio from the Hong Kong Mortgage Corporation, and pay just 10 per cent as down payment.

Block 16, the village house where the three apartments are located, was completed in October last year and will be liable to the vacancy tax if it is passed in the Legislative Council next year.

Property at Wah On Villa was put on sale several times in 2014-15. A flat of 745 sq ft with a balcony of 132 sq ft on the first floor of block 23 sold for HK$950,000 in June 2014, when it was first launched.

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The Centa-City Leading Index, Centaline Property Agency’s index of home prices, has declined for seven weeks, by a total of 3.32 per cent, to about the level in May. The drop for the week ending on November 11 amounted to 1.28 per cent, its biggest weekly drop since the week ending on March 13, 2016.