Bloomberg: Hong Kong Developers Under Pressure to Cut Prices Amid Slowdown

[BlueKelah]

one case doesn't represent the whole. Based on common sense, 70% is ridiculous, if it's really true, a lot of home owners will be in trouble

The tender was for land, which is only one component of cost of a finished flat. On Hong Kong Island it will be a big % of the total cost, but much less so out in Tai Po, well out in the NT. Secondhand flats are off maybe 10% to 15% from the peak last year - difficult to tell, as there are few transactions. A house on HK Island just sold for 'only' HK$830m, when they were expecting over HK$1b.

There is a big supply of flats coming on-stream - just like Singapore. Combine economic weakness, in Hong Kong and China with boost in supply, and prices are bound to come down. Especially if the US raises interest rates, although that is not so certain now.

Overall, it will be a good thing. Prices were just too high for the ordinary families. Last year, my flat in the NT was 'worth' 6 times what I paid for it in 2003. 6x in 12 years. That is insane. Some people, who have bought in the last 4 years will get burned, but the majority of homeowners bought at much lower prices.

haha dosser have you sold your flat yet? 6 bagger in 12 years is insane. Which goes to show those mainland/honky speculators are insane. Reminds one of the TULIPS. only these are much bigger..

[Dosser]

one case doesn't represent the whole. Based on common sense, 70% is ridiculous, if it's really true, a lot of home owners will be in trouble

The tender was for land, which is only one component of cost of a finished flat. On Hong Kong Island it will be a big % of the total cost, but much less so out in Tai Po, well out in the NT. Secondhand flats are off maybe 10% to 15% from the peak last year - difficult to tell, as there are few transactions. A house on HK Island just sold for 'only' HK$830m, when they were expecting over HK$1b.

There is a big supply of flats coming on-stream - just like Singapore. Combine economic weakness, in Hong Kong and China with boost in supply, and prices are bound to come down. Especially if the US raises interest rates, although that is not so certain now.

Overall, it will be a good thing. Prices were just too high for the ordinary families. Last year, my flat in the NT was 'worth' 6 times what I paid for it in 2003. 6x in 12 years. That is insane. Some people, who have bought in the last 4 years will get burned, but the majority of homeowners bought at much lower prices.

haha dosser have you sold your flat yet? 6 bagger in 12 years is insane. Which goes to show those mainland/honky speculators are insane. Reminds one of the TULIPS. only these are much bigger..

No. If I was really brave I would have sold and rented for a couple of years, and bought in again when the price drops...but I have known people who tried to do that, and the price went up instead of down. So I don't take risks with my home. Lets face it, it is still the same flat, regardless of what the price might be at any moment in time.

Luckily the wife bought another one in 2005, for rental, which we sold in April last year. Didn't buy at the low point or sell at the high point of the market, but happy with the outcome.

[soros]

Wow , Where in NT has property price gone up to 6x price paid in 2003 ?

My flat in Yuen Long is up 3x price paid in 2005.

[fundamentalman]

Cheung Kong Property's Chiu Seeks to Sell 3,000 Units This Year




by
Frederik Balfour
t Frederikbalfour


February 26, 2016 — 3:22 PM WIB


Cheung Kong Property Holdings Ltd. isn’t planning to alter its average pace of home sales in Hong Kong despite the property downturn, company executive director Justin Chiu said on Friday.

è Justin Chiu.
square before the information Justin Chiu. Photographer: Jerome Favre/Bloomberg

"We always look at ourselves as a factory, so every year we can release about 3,000 units to the market," he said in an interview. "We hope to at least match last year’s figures in terms of units and even in turnover," he said. The group, founded by billionaire Li Ka-shing, achieved HK$30 billion ($3.9 billion) in Hong Kong sales last year.

Rising interest rates and a slowing economy have spurred an 11 percent decline in home prices since September in Hong Kong, and they could slide 30 percent this year, according to Bocom International Holdings Co.’s Alfred Lau. Chiu said the company’s ability to achieve its sales target depends less on market conditions than on government approvals for the seven projects it plans to launch this year.