Heavy rain in Hong Kong and high interest rates dampened property sales in the New Territories on Saturday, even with steep discounts offered by the developer. Early Light International Holdings, owned by tycoon Francis Choi Chee-ming, launched the second phase of The Uppland at Gold Coast Bay in Tuen Mun. Despite the inclement weather, the company managed to sell 118 out of 139 flats, according to property agents.
The second phase included 87 studios, 20 one-bedroom, 27 two-bedroom, and five three-bedroom units, with prices ranging from HK$2.23 million (US$285,641) to HK$7.76 million after discounts, or HK$8,768 to HK$14,051 per square foot. The average price of these units was about 10% lower than a similar project launched last month in the same area.
The average price after discounts was HK$11,126 per square foot, higher than the HK$10,209 per square foot in the first round of 188 flats. “We predict The Uppland at Gold Coast Bay will sell over 100 units today. The heavy rain and the Olympic Games will lower the incentive for flat viewing this weekend,” said Louis Chan Wing-kit, CEO of Centaline Property Agency’s residential division.
Hong Kong experienced heavy rain as super typhoon Gaemi moved off the coast of Taiwan towards Fujian over the past few days. Despite the weather, The Uppland had received over 7,900 applications earlier in the week for the 139 flats, making them nearly 57 times oversubscribed. The development offers a total of 1,323 flats in its first phase, with The Uppland supplying 692 units.
The turnout on Saturday was “not too bad,” with about 80% of the units expected to sell, said Sammy Po Siu-ming, CEO of the residential division at Midland Realty. However, interest had cooled compared to last weekend’s sale, where all 188 flats were sold.
The supply of new flats in the city is projected to rise to 112,000 in the next three to four years, according to estimates by the Housing Bureau. This comes at a time when demand is dwindling due to high interest rates and a slowing economy. Buyers are increasingly anticipating interest-rate cuts by the US Federal Reserve in mid-September, which could provide some relief to Hong Kong’s property market.
Centaline’s Chan expects a rebound in the property market in July, driven by rising expectations of a Fed interest-rate cut. He anticipates new-home sales to almost double from the previous month to 1,300 deals. Centaline also predicts home prices may drop by 3% in the third quarter, but could rebound by 3-5% in the following quarter if the local monetary authority cuts rates in line with the Fed.
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