A flat owner's story
Not too many landlords were smiling over the past four months in view of the political unrest that has dealt a telling blow to the property business as a whole.
Take the case of a certain flat owner at Flora Plaza in Sheung Shui.
Three weeks ago, the man sold his two-bedroom flat measuring 392 square feet for HK$5.17 million. However, the buyer failed to complete the deal and walked away after paying a HK$100,000 deposit.
The owner lowered his asking price to HK$5.1 million, but only managed to sell it last Sunday for HK$4.83 million, 6.6 percent lower than his original asking price.
But in a repeat of what happened earlier, the new buyer turned away from the deal after paying a HK$5,000 deposit.
It was a good decision on the part of the buyer because, only a few days after, Chief Executive Carrie Lam Cheng Yuet-ngor relaxed mortgage rules in a bid to make housing more affordable and young Hongkongers feel less disgruntled.
In her policy address on Wednesday, Lam raised the ceiling for a mortgage loan with a cover of 90 percent to HK$8 million from the previous HK$4 million.
The new rule, while good news for homebuyers, also prompted many property owners to raise home prices in anticipation of stronger demand.
The flat owner in our story finally managed to sell his home on Thursday – for HK$5.08 million. Although that's below the HK$5.17 million he originally wanted for the property, he consoled himself with the fact that he was able to get an extra HK$15,000 because of the two walkouts.
Unlike him, though, the big property owners are salivating after hearing the latest policy address because more people will be buying their homes.
Investors believe so, and the share prices of leading developments – most notably New World Development (00017. HK) and Sun Hung Kai Properties (00016.HK) – are on track for a third-day rally.
However, Lam's policy address provided only a little stimulus to two new residential projects – SHKP's Cullinan West III in Sham Shui Po and CK Asset's (01113.HK) Seaside Sonata in Tsuen Wan. Both developers were only able to clear about half of the first batch of the units they had put up for sale.
After all, property prices are a gauge of the current market sentiment, the people's level of confidence in the economy as a whole.
Right now, many people are pessimistic about the city's outlook. But when it comes to property, market pundits say, home prices never die, they just sleep for a while.
– Contact us at [email protected]
CG
-
Epidemic and 40-year-high inflation stalk HK migrants in UK Mark O'Neill
The website of the Trinity Church in Sutton, southwest London, is written in English and traditional Chinese – 歡迎香港人, Welcome Hong Kong people. “The middle of a pandemic is not an easy time to arrive
-
The privilege of shorter quarantine Ben Kwok
The nightmare of staying in a hotel for three full weeks might hopefully be over. Yesterday the National Health Commission announced to shorten the hotel quarantine period for people arriving in the
-
3D maps enhance disaster prevention and rescue Dr. Winnie Tang
Abnormal and even extreme weather has become more frequent. The Observatory forecasts that tropical cyclone incidence and total rainfall this year will be "normal to high". To be well-prepared, the
-
Ignoble ease Neville Sarony
There is no shortage of commentators, both lawyers and lay people, who feel entitled to criticize Hong Kong’s legal community for what these observers assert is a failure to stand up for the liberal
-
An imminent private housing supply chasm and its solutions Ryan Ip Man-ki, Jason Leung Yeuk Ho
As the 5th wave of Covid-19 gradually subsides, waves of new private housing projects are now under the spotlight. Intensifying competition among developers became the talk of the town after a
