Buyers flock to Centra Horizon's property sale in Tai Po, in an overwhelming response that is a harbinger of rising home prices

By Lam Ka-sing / | April 30, 2019 4:15 PM SGT
Homebuyers flocked to the weekend sale of a residential project in Tai Po, forming a long queue that encircled the sales office even after the developer priced its flats 4.1 per cent higher than a January offering, in a harbinger of rising real estate prices in Hong Kong.
As many as 4,950 registrations of interest were received for 295 flats at the Centra Horizon project in Pak Shek Kok, or 16 bidders for every available unit. As of 7:45pm 220 flats, or nearly 75 per cent of the offerings, had been sold, said agents for the developer Billion Development and Project Management.
"The prices [of some of the flats at Centra] are low at around HK$3 million (US$382,500), so a lot of first-time buyers are interested," said Midland Realty's residential division chief executive Sammy Po, adding that the 100 three-bedroom units in the current release may not be as popular as studios or one-bedroom units.
The most sought-after units in Centra Horizon are the 54 studios priced at below HK$4 million each, which qualify them for loans equal to 90 per cent of the property's value through the Hong Kong Mortgage Corporation's mortgage insurance programme. That makes these studios popular among first-time buyers.
At 183.19, the index is less than 3 per cent from last August's peak, which suggests that the prices of lived-in homes could set a record by the end of April, said Ricacorp Properties' chief executive Willy Liu.
General view of Pak Shek Kok residential buildings on 23 April 2019. (Front row from the Left) Ontolo (yellow), Horizon, May Fair by the Sea Phase 1 and 2, The Graces Providence Bay Phase 3, Providence Phase 1. (Back Row from the Left) Horizon Phase 2 (Green), Solaria (Yellow), St. Martin Phase 1 and 2, Providence Peak. Photo: SCMP/Martin Chan
At least 20 per cent of Centra Horizon's units are sold at fixed prices, under the consensus agreement by Hong Kong's Real Estate Developers Association (Reda) after an abuse of tender rules drew public criticism.
Developers use sale-by-tender as a tactic to avoid discounts at times of lacklustre sales during downturns in the property market, said Centaline's Asia-Pacific vice-chairman Louis Chan.
The price of the current batch of Centra Horizon averaged HK$13,774 per square foot after discounts. Prices started at HK$3.6 million after discounts for a studio measuring 243 square feet (22 square metres).
The average price is 4.1 per cent higher than Sino Land's Mayfair by the Sea development, which offered flats for sale in January during the property market's downturn at HK$13,228 per sq ft. Still, Centra Horizon is 1.5 per cent lower than Wheelock Properties' Montara in Lohas Park, which announced its pricing of HK$13,990 per sq ft on Friday.
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