Li Ka-shing sells houses at a discount, and 28,000 groups of customers grab 422 suites! Hong Kong's property market is hot and reproduces "daily discs"

Reporter: Liu Songhui Editor: Wei Wenyi

Hong Kong's property market continues to be hot!

On the morning of April 6, the "Blue Coast (South Coast) project" jointly developed by Cheung Kong Group and MTR Group was launched for the first time with 422 units, and tens of thousands of buyers crowded the opening site of Hung Hom, and the queue stretched for hundreds of meters.

According to data from Hong Kong Centaline Real Estate, as of the opening of April 6, the Blue Coast project had subscribed a total of 28,000 groups in 8 days, oversubscribed by 65 times, and was on the current "ticket king" of Hong Kong's new projects this year, with an average of 66 people grabbing 1 suite.

On February 28 this year, after Hong Kong's 14-year property market "spicy move" was announced to be abolished (hereinafter referred to as "spicy withdrawal"), the market demand was strong, and developers seized the window period to accelerate the launch, and the south coast of Hong Kong Island also became the new project with the largest number of listings launched in a single day after Hong Kong's "spicy withdrawal". As of 10 p.m. on the opening day, all 422 units of the project were sold.

Previously, Henderson Group's BP project in Cheung Sha Wan, Kowloon Peninsula, Hong Kong, became the first "day disc" after the "spicy" withdrawal of the Hong Kong property market.

The opening site of the Blue Coast project Image source: Centaline Real Estate

In 8 days, a total of 28,000 groups of customers were subscribed

The Hong Kong Island South Shore project is located in Wong Chuk Hang, Hong Kong, which is the largest property on top of the MTR Wong Chuk Hang Station, and Blue Coast is the third phase of the project, with a total of 1,200 units and a commercial component.

In terms of transportation facilities, the south shore of Hong Kong Island is not only equipped with an exclusive lift connecting the residential platform and shopping malls, but also has a direct access to the exit of the MTR station Wong Chuk Hang, making transportation very convenient. It takes only about 5 minutes to drive from the project to the Aberdeen Tunnel Entrance, and then it takes only 15 minutes to reach Kowloon via the Red Tunnel, and the whole journey can be reached to Causeway Bay within 20 minutes.

At the same time, the project belongs to the primary 18 school net and the secondary school network in the southern district, and there are many high-quality international schools and private direct subsidy schools nearby, such as the Canadian International School, Hujiang Victoria School, Singapore International School, etc.

The reporter of "Daily Economic News" learned in an interview that Wong Chuk Hang is one of the most popular new housing areas in Hong Kong in the past few years, and the opening price is not low. For example, the average price of the Jinhuan project developed by MTR, Road King and Ping An Real Estate is HK$29,600 per square foot (1 sq ft ≈0.09290304 sq ft), the average price of the Yanghai project developed by MTR, Kerry Properties and Sino Land is HK$30,000 per sq ft, and the average price of the Haiying Shan project developed by Kerry Properties, Sino Land, Swire Properties and MTR is HK$27,900 per sq ft.

At a cost of about HK$28,000 per square foot, the average price of the Blue Coast launched by Cheung Kong Group is HK$21,900 per square foot, which is equivalent to selling a house at a 78% discount. The 422 units supplied this time include two-bedroom and three-bedroom units, with a discounted price of HK$18,998 to HK$27,257 per square foot, and an average discounted price of HK$22,955 per square foot, with a total value of over HK$7.5 billion and an average total price of about HK$17.77 million.

Following the 70% discount sale of the Qinhai Station II in the Yau Tong section of Kwun Tong District, Kowloon, Cheung Kong Group once again put a "depth bomb" into the market, and Blue Coast quickly received tens of thousands of subscription requests. Although Blue Coast's total price is not low in Hong Kong's new home market, buyers clearly see its price advantage of HK$6,000 per square foot lower.

According to the video taken by local media in Hong Kong, on the opening day, because the developer required the "on-site lottery", all buyers must draw a number on the spot before entering the infield to select a house, resulting in another hot scene of "10,000 people grabbing houses" in Hung Hom. Multimillionaires sit in the hall of the infield preparing to choose a room, and countless people crowd into the aisle and wait in long lines to enter.

Kwok Tsz-wai, chief manager of the sales department of Cheung Kong Group, said that Blue Coast will actively consider launching more units in the market, but the price of units may increase significantly, with some units increasing by about 10%.

According to Yang Guiling, assistant chief manager of the sales department of Cheung Kong Group, before the opening of Blue Coast, there was a lively scene in the model room, and the proportion of mainland customers who visited the house increased from 20%~25% to more than 30%.

Non-local buyers are the beneficiaries of the new policy

On April 7, a person from the Hong Kong company of a global real estate consulting agency bluntly said in an interview with every reporter that the Blue Coast can sell well because it is "cheap". In the past three years, residential projects at NTN Railway stations have sold for HK$18,000~HK$19,000 per square foot, "Now with a little more money (HK$21,000 per square foot), you can buy a residence on Cheung Kong Island." ”

According to the market report released by the agency, after the Hong Kong property market was "withdrawn" at the end of February this year, the proportion of mainland buyers in the new sales of luxury homes priced at more than HK$30 million has rebounded from less than 50% before the "withdrawal" in October last year to about 70% recently, and it is expected that mainland buyers will continue to be active. In just nine days after the "withdrawal", Hong Kong's first-hand property market recorded 1,275 transactions, reflecting the active entry of buyers into the market, in stark contrast to the previous cautious wait-and-see attitude.

In addition, according to Midland Realty's monitoring data, the number of first-hand housing transactions in Hong Kong rose by more than 14 times month-on-month to 4,200 in March, hitting a new monthly high since 1998, and the transactions of the top 10 second-hand housing estates rose by about 2.6 times month-on-month to 359.

It is worth noting that non-local buyers are the biggest beneficiaries of the "withdrawal", with an increase in mainland buyers in the recent new sales in Hong Kong, with the highest proportion of mainland buyers in particular luxury new property launches.

Li Yuanfeng, senior director of project strategy and advisory department of Jones Lang LaSalle, said that as demand continues to pick up, it is expected that Hong Kong's first-hand housing market transaction investment will continue to be booming in the second quarter of this year. "Mainland buyers have benefited the most from the 'spicy withdrawal' of the property market, and with the TTPS Scheme, we have seen a significant increase in mainland buyers in the new market, and they are expected to continue to be active. ”

"However, at present, some non-local buyers are still not fully returning to the market due to factors such as foreign exchange controls, mortgage application requirements and property viewing procedures, and it is believed that the overall transaction volume will further increase after the relevant restrictions are lifted and the mainland economy improves. Li Yuanfeng thinks.

There are two key factors behind the current surge in sales in Hong Kong's first-hand home market. First of all, the price of first-hand homes has experienced a significant decline from the high in 2021, and the average price of some recent new projects has fallen by about 30%, which is a relatively lower barrier to entry for buyers with abundant cash.

The release of pent-up demand from new households is another key factor. In 2012~2021, there were an average of 542 first-hand home transactions for every 1,000 new households in Hong Kong, and the number of transactions dropped significantly to 466 in the past two years. If this ratio returns to the long-term average, it means that the rigid demand for new households in the past two years has not been realized, which could lead to an additional 3,500 first-hand home transactions.

In the view of Zhong Churu, senior director of the research department of Jones Lang LaSalle, it is still too early to judge whether the support effect of the "withdrawal of spicy" on the Hong Kong property market is temporary or long-term.

"Although the market generally believes that the 'spicy withdrawal' can boost property prices, property prices still need to face the challenge of high mortgage rates in the short term, and the economic growth rate is not as fast as expected, external challenges remain, and the negative spread between rental yields and mortgage rates still bothers investors. As the main demand for small and medium-sized residential properties, local buyers have benefited limited from this round of relaxation, and the suspension of mortgage stress testing has only slightly reduced the income requirement by about 4.3%, so they should remain cautious about the market outlook. Zhong Churu said.

National Business Daily