Date
21 November 2017
As mortgage rules tighten, demand is shifting from the secondary market to new homes. Photo: Bloomberg
As mortgage rules tighten, demand is shifting from the secondary market to new homes. Photo: Bloomberg

Tightening of mortgage rules drives up new home prices

The recent tightening of the rules for mortgages has depressed demand for used homes in the mass market but driven up demand for new homes, for which developers can offer additional loans.

As a result, some property developers have raised the prices of their projects to be sold this weekend.

The price hikes affect 574 units in total, the Hong Kong Economic Journal reported Thursday.

Hang Lung Properties Ltd. (00101.HK) raised the prices of its eight remaining units at Kowloon Station by up to 21 percent.

Henderson Land Development Co. Ltd. (00012.HK), meanwhile, increased the prices of its three remaining units at a development in Cheung Sha Wan by about 10 percent.

However, Hong Kong Ferry (Holdings) Co. Ltd. (00050.HK) and Lai Sun Development Co. Ltd. (00488.HK) have slightly lowered the prices of their residential projects, in Fanling and Tai Hang Road, respectively.

Nan Fung Group’s new development in Tung Chung has been warmly received; the 315 units to be offered have attracted twice the number of would-be buyers.

Another new project, by Cheung Kong (Holdings) Ltd. (00001.HK), has been 8.3 times oversubscribed.

Those two projects have locked up about HK$200 million combined.

Translation by Vey Wong

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