HK homebuyers defy broken economy, surging unemployment, snapping up flats at Wheelock’s Monaco project in Kai Tak

23-Jan-2021 Intellasia | South China Moring Post | 6:02 AM Print This Post

Enthusiastic homebuyers defied concerns that Hong Kong’s sky-high unemployment rate and economic malaise might undermine demand by snapping up new flats offered by Wheelock Properties at its Monaco project on Thursday.

The second round of sales at the development in Kai Tak saw almost all of the 133 units taken within five hours. All 13 flats offered by tender and all but three of the 120 on an open price list had been sold as of 9pm, Wheelock said.

The tendered units received 31 bids, at prices ranging from HK$24,787 to HK$27,822 per square foot, generating HK$257.48 million in proceeds.

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It followed a successful first round of sales on Sunday, at which all 145 units sold in less than six hours.

The buoyant sales will have come as a pleasant surprise to many analysts, who expected demand to be severely dampened by an economy devastated by the coronavirus and last year’s protest movement.

In addition to unemployment at a 16-year high, many people have taken pay cuts or unpaid leave, denting their purchasing power, said Thomas Lam Ho-man, the head of valuation and advisory at Knight Frank Greater China.

“Businesses are doing poorly, which affects the income of many in the upper-middle income level and reduces interest among the middle class to buy and change properties,” Lam said. He expects a 5 per cent decline in house prices in 2021.

Sammy Po Siu-ming, the chief executive of Midland Realty’s residential division, said the rising jobless rate was unlikely to impact property sales.

“Unemployment is concentrated in a few sectors, such as catering, tourism, hospitality and retail. But other professions such as those in real estate, finance, IT, professionals and civil servants have a lower jobless rate. They are supporting the housing market,” he said.

“Also because of the low-interest environment and a weakening currency from money printing, we have seen some buyers getting quicker in purchasing properties.”

In a Citibank survey of 500 randomly chosen respondents conducted in December, 43 per cent of them expected property prices to stay flat this year. Respondents with a bearish view of housing prices dropped from 43 per cent in the third quarter of 2020 to 36 per cent in the last quarter.

Wheelock’s managing director Ricky Wong Kwong-yiu said the developer had decided to increase the prices for the second round by 7.7 per cent to HK$24,409 per square foot from HK$22,669 in the first round after discounts.

Wheelock had received nearly 2,270 cheques for the 120 Monaco units sold on the open price list, disappointing nine in ten potential buyers, it said in a statement on Wednesday.

The batch was priced from HK$22,348 to HK$26,396 per square foot after discounts. Nineteen three-bedroom flats were sold out within 30 minutes.

The units’ saleable area ranged from 280 square feet for studios to 727 square feet for apartments with three bedrooms and an ensuite.

The 13 tendered units all measured 762 sq ft and went for an average of HK$25,992 per sq ft. One of them, unit 37A in Tower 2A, became the most expensive Monaco unit sold to date, at HK$21.2 million.

Wheelock said it may raise prices for future sales by 5 per cent because of the strong sales on Thursday.

Separately, Nam Fung Group will begin to sell 179 units of LP10, the 10th phase of the Lohas Park housing project in Tseung Kwan O on Saturday morning. The development has 893 flats in total. The average price for the entire batch will be HK$15,888 per square foot after a discount of 20.5 per cent. The residential development, which will be Hong Kong’s largest upon completion, is jointly developed by Nam Fung and the MTR Corporation.


Category: Hong Kong

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