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Business Times
4 days ago
- Business
- Business Times
New World prices Hong Kong luxury home project at record low
[HONG KONG] New World Development launched a luxury residential project on the south side of Hong Kong Island at a record low price as the embattled developer aims to accelerate property sales amid debt concerns. The firm priced the first batch of 101 apartments in its co-developed Deep Water Pavilia project at HK$20,932 (S$3,431.9) per square foot. The pricing marks the lowest of any new residential project in the city's posh southern district, according to Centaline Property Agency. New World, one of Hong Kong's top four developers and owned by the Cheng family, has pledged to speed up sales of its residential projects in Hong Kong as it struggles to service around HK$210.9 billion in liabilities. The group faces worsening pressure to repay loans if it can't strike a deal with banks to refinance HK$87.5 billion of its borrowings by the end of this month, Bloomberg reported earlier. The developer's turmoil highlights the broader troubles facing Hong Kong's property market. The city has been grappling with a sluggish economy and a shift in demographics that have weighed on home prices, which declined by about 29 per cent from their peak in 2021, according to data from Centaline. The number of households in negative equity, meaning their properties are worth less than the loans they took out for the purchase, is the highest since 2003 as of the end of March. BLOOMBERG
Straits Times
15-05-2025
- Business
- Straits Times
Hong Kong's top developer sells out homes in hours as rates fall
HONG KONG – Hong Kong's biggest property developer Sun Hung Kai Properties Ltd sold out the first batch of homes for a new project within hours, as the lowest mortgage rates in more than two years lured buyers. Sun Hung Kai sold all 160 units in the 1B phase of Sierra Sea, a residential development in the Ma On Shan area, according to Centaline Property Agency. A drop in interest rates is helping the city's residential sales, which saw an unprecedented downturn in the past few years. The one-month Hong Kong Interbank Offered Rate is hovering at 1.3 per cent, the lowest since August 2022. Sun Hung Kai may beat its HK$25 billion (S$4 billion) Hong Kong contracted sales target by 50 per cent in the fiscal year ending in June, as mortgage rates drop for new-home buyers, Bloomberg Intelligence said in a note this week. The city's effective mortgage rate linked to Hibor has dropped to 2.87 per cent, the lowest in more than two years, according to mReferral Mortgage Brokerage Services. Falling interest rates are positive for property companies, JPMorgan Chase & Co analysts including Mr Karl Chan wrote in a note on May 7. They estimate an average 5 per cent earnings boost for every 100 basis point annualised decrease in financing costs from floating debt for the developers. Meanwhile, the chances of Hong Kong's residential property market bottoming out are growing on the back of cheaper interest rates, according to Jefferies Financial Group Inc. Hong Kong home prices are 29 per cent below their peak in 2021, data from the government show. The number of households with negative equity – when the value of a property is less than the outstanding mortgage loan – rose to the highest since 2003 as of the end of March. BLOOMBERG Join ST's Telegram channel and get the latest breaking news delivered to you.
Business Times
15-05-2025
- Business
- Business Times
Hong Kong's top developer sells out homes in hours as rates fall
[HONG KONG] Hong Kong's biggest property developer Sun Hung Kai Properties sold out the first batch of homes for a new project within hours, as the lowest mortgage rates in more than two years lured buyers. Sun Hung Kai sold all 160 units in the 1B phase of Sierra Sea, a residential development in the Ma On Shan area, according to Centaline Property Agency. A drop in interest rates is helping the city's residential sales, which saw an unprecedented downturn in the past few years. The one-month Hong Kong Interbank Offered Rate is hovering at 1.3 per cent, the lowest since August 2022. Sun Hung Kai may beat its HK$25 billion (S$4.2 billion) Hong Kong contracted sales target by 50 per cent in the fiscal year ending in June, as mortgage rates drop for new-home buyers, Bloomberg Intelligence said in a note this week. The city's effective mortgage rate linked to Hibor has dropped to 2.87 per cent, the lowest in more than two years, according to mReferral Mortgage Brokerage Services. Falling interest rates are positive for property companies, JPMorgan Chase analysts including Karl Chan wrote in a note on May 7. They estimate an average 5 per cent earnings boost for every 100 basis point annualised decrease in financing costs from floating debt for the developers. Meanwhile, the chances of Hong Kong's residential property market bottoming out are growing on the back of cheaper interest rates, according to Jefferies Financial Group. Hong Kong home prices are 29 per cent below their peak in 2021, data from the government show. The number of households with negative equity – when the value of a property is less than the outstanding mortgage loan – rose to the highest since 2003 as at the end of March. BLOOMBERG
South China Morning Post
07-05-2025
- Business
- South China Morning Post
Brisk Hong Kong home sales continue at Sun Hung Kai Properties' Sierra Sea
Sun Hung Kai Properties (SHKP) is likely to sell out the latest batch of flats in its massive Sierra Sea development in the New Territories on Wednesday despite a nearly 10 per cent increase in prices, according to analysts. Advertisement Hong Kong's largest developer sold 112 of the 150 flats on offer in the 9,700-unit project as of 6.30pm, according to agents, after the sale began at 3pm. The project in Shap Sze Heung, located between Sai Kung and Ma On Shan, is one of the city's largest residential developments since 1999. The first two batches sold out on April 26 and Saturday as buyers snapped up homes at prices as much as 20 per cent below second-hand properties in the area. 'The real estate market had a good start at the beginning of this month, with Sierra Sea being a hot seller,' said Louis Chan Wing-kit, CEO at Centaline Property Agency. 'Buyers' confidence in entering the market will significantly strengthen, and the first-hand transaction volume this month is bound to increase.' In April, developers sold 1,114 new units, less than half of the 2,418 flats sold in March, according to Midland Realty. Advertisement So far this month, more than 450 primary transactions had been recorded, Centaline's Chan said. The upbeat outlook for the residential market is underpinned by anticipated interest rate cuts in coming months, as well as China's stimulus policies.
South China Morning Post
05-05-2025
- Business
- South China Morning Post
Hong Kong developer SHKP rushes out more Sierra Sea flats amid surge of mainland buyers
Sun Hung Kai Properties (SHKP) is launching another batch of flats in its Sierra Sea project in the New Territories following two consecutive sold-out weekends in one of Hong Kong's largest residential projects in more than a quarter century. Advertisement On Wednesday, Hong Kong's largest developer will offer 150 flats in the 9,700-unit project in Shap Sze Heung, located between Sai Kung and Ma On Shan. The flats range in size from 301 sq ft to 702 sq ft. The units are priced between HK$12,675 (US$1,635) and HK$15,486 per square foot. Of the 150 units, 128 will be sold via a regular sale with an average price after discounts of HK$11,897 per square foot – about 9.4 per cent higher than the first two batches of flats launched on April 26 and Saturday . The other 22 flats will be sold via tender. The sale comes after Saturday's sale drew a surge in mainland Chinese buyers, whose numbers increased between 10 and 40 per cent compared with the previous weekend's sale as China's five-day Labour Day holiday got under way, according to Louis Chan Wing-kit, CEO of Centaline Property Agency. The first two batches of units at the project hit the market at an average selling price last seen in the area in 2013. The average discounted price of HK$10,877 per square foot was also 20 per cent lower than prices for nearby second-hand flats. Advertisement
