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HONG KONG: Investors and owner-occupiers rode the continuing rally in home prices last week, ignoring talk of further cooling measures in Wednesday's policy address by Chief Executive Donald Tsang Yam-kuen.
Secondary market sales in the 50 major housing estates monitored by estate agency Ricacorp Properties rose across the board, with 436 deals done from Monday to Sunday, up 70% from the previous week.
In the primary market, developer Sun Hung Kai Properties raised prices by between 3% and 5% for a batch of 20 houses it has on offer at its Valais development in Sheung Shui. Buyers have snapped up 250 of the houses since the launch of sales this month. SHKP has so far generated revenue of more than HK$8 billion (RM3.18 billion) from sales at the Valais.
"As cash is no longer king, investors will move quicker in a bid to hedge against surging inflation," said Wong Leung-sing, an associate director in the research department at Centaline Property Agency. "And end-users are wary they will miss the boat after seeing no sign of any price corrections in the near term."
Property values continue to be supported by low interest rates in a climate of rising inflation since real estate presents a way of protecting wealth against the corrosive impact of inflation, said Wong.
He expects prices to surpass pre-1997 peaks next year.
Based on the Centa-City Index, which tracks prices in the secondary market, the average home price is still some 17% below the peak level reached in October 1997, when the Asian financial crisis erupted and sent property values tumbling.
The index was then at a level of 102.93; now it is at 84.85.
In the luxury market, prices at selected projects have already surpassed their pre-1997 peaks. Henderson Land Development last month sold a 5,636 sq ft duplex at 39 Conduit Road in Mid-Levels for HK$338.16 million, or HK$60,000 per square foot, making it the city's most expensive flat on a price-per-square-foot basis.
David Chan Tai-wai, a director of Ricacorp, said sales on Hong Kong Island, in Kowloon and in the New Territories were all up sharply over the weekend.
"The New Territories was the star performer as many buyers turned to the secondary market after they failed to buy at a major new project in the district," he said.
Cheung Kong (Holdings) last month sold all 1,143 flats at Oceanaire in Ma On Shan after registering interest from nearly 3,000 potential buyers.
In the New Territories, sales volume in the secondary market jumped 97%, with 201 deals last week against 102 a week earlier.
Week on week, the sales volume in the secondary market on Hong Kong Island increased 57% to 66, and 169 deals were done in Kowloon, up 50% on the previous week.
"Sentiment turned very strong last week," Simon Tai Hok-man, senior sales manager at estate agency Hong Kong Property's Olympic Station branch, said.
"One investor signed a preliminary sale and purchase agreement three hours after visiting a flat at Harbour Green in Tai Kok Tsui.
"The investor bought the 625 sq ft unit for HK$4.75 million or HK$7,600 per square foot and aims to rent it out."
Rents for flats of this size at Harbour Green were about HK$16,000 per month, he said, and the property could generate an annual rental yield of 4%.
Sales of luxury homes — those worth more than HK$10 million — meanwhile rose strongly in the third quarter.
According to Hong Kong Property, there were 3,804 sales registered for homes worth more than HK$10 million in the quarter — up 45% from the previous quarter.
The total value of the deals rose 47%, to HK$58 billion, in the third quarter compared with the second quarter.
Sixty-one new hones were sold last Saturday and Sunday in Taikoo Shing, Quarry Bay and Mei Foo Sun Chuen in Kowloon, according to Centaline. — South China Morning Post
Secondary market sales in the 50 major housing estates monitored by estate agency Ricacorp Properties rose across the board, with 436 deals done from Monday to Sunday, up 70% from the previous week.
In the primary market, developer Sun Hung Kai Properties raised prices by between 3% and 5% for a batch of 20 houses it has on offer at its Valais development in Sheung Shui. Buyers have snapped up 250 of the houses since the launch of sales this month. SHKP has so far generated revenue of more than HK$8 billion (RM3.18 billion) from sales at the Valais.
"As cash is no longer king, investors will move quicker in a bid to hedge against surging inflation," said Wong Leung-sing, an associate director in the research department at Centaline Property Agency. "And end-users are wary they will miss the boat after seeing no sign of any price corrections in the near term."
Property values continue to be supported by low interest rates in a climate of rising inflation since real estate presents a way of protecting wealth against the corrosive impact of inflation, said Wong.
He expects prices to surpass pre-1997 peaks next year.
Based on the Centa-City Index, which tracks prices in the secondary market, the average home price is still some 17% below the peak level reached in October 1997, when the Asian financial crisis erupted and sent property values tumbling.
The index was then at a level of 102.93; now it is at 84.85.
In the luxury market, prices at selected projects have already surpassed their pre-1997 peaks. Henderson Land Development last month sold a 5,636 sq ft duplex at 39 Conduit Road in Mid-Levels for HK$338.16 million, or HK$60,000 per square foot, making it the city's most expensive flat on a price-per-square-foot basis.
David Chan Tai-wai, a director of Ricacorp, said sales on Hong Kong Island, in Kowloon and in the New Territories were all up sharply over the weekend.
"The New Territories was the star performer as many buyers turned to the secondary market after they failed to buy at a major new project in the district," he said.
Cheung Kong (Holdings) last month sold all 1,143 flats at Oceanaire in Ma On Shan after registering interest from nearly 3,000 potential buyers.
In the New Territories, sales volume in the secondary market jumped 97%, with 201 deals last week against 102 a week earlier.
Week on week, the sales volume in the secondary market on Hong Kong Island increased 57% to 66, and 169 deals were done in Kowloon, up 50% on the previous week.
"Sentiment turned very strong last week," Simon Tai Hok-man, senior sales manager at estate agency Hong Kong Property's Olympic Station branch, said.
"One investor signed a preliminary sale and purchase agreement three hours after visiting a flat at Harbour Green in Tai Kok Tsui.
"The investor bought the 625 sq ft unit for HK$4.75 million or HK$7,600 per square foot and aims to rent it out."
Rents for flats of this size at Harbour Green were about HK$16,000 per month, he said, and the property could generate an annual rental yield of 4%.
Sales of luxury homes — those worth more than HK$10 million — meanwhile rose strongly in the third quarter.
According to Hong Kong Property, there were 3,804 sales registered for homes worth more than HK$10 million in the quarter — up 45% from the previous quarter.
The total value of the deals rose 47%, to HK$58 billion, in the third quarter compared with the second quarter.
Sixty-one new hones were sold last Saturday and Sunday in Taikoo Shing, Quarry Bay and Mei Foo Sun Chuen in Kowloon, according to Centaline. — South China Morning Post
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