Buyers rush to snap up offering of small flats

HONG KONG: Hundreds of home seekers and investors lined up last Saturday, July 10 to snap up 365 flats at two housing projects — signalling buyers are taking advantage of a rising property market.

Some 285 flats or 76% of the flats at Lime Stardom in Tai Kok Tsui were gone by 5pm after sales were launched at 9am.

Lime Stardom, developed by Sun Hung Kai Properties and the Urban Renewal Authority and offering 377 flats, is the only development providing small flats to go on the market in the past three months.

About 70% of the flats are less than 500 sq ft.

Sino Land yesterday released 120 flats at The Hermitage, also in Tai Kok Tsui, in a fourth round of sales. Agents said about 80 flats were sold by 7pm.

Hundreds began queuing at 7am in a shopping mall in Causeway Bay for the sale of Lime Stardom flats.

In the morning, URA chairman Barry Cheung Chun-yuen forecast that sales of the project would be strong. He said asking prices were reasonable and competitive.

He said the authority would release 1,300 flats for sale in the next 18 months. About 70% of them will be of less than 600 sq ft, which could help meet demand from the first-time buyers.

The project is also proving attractive for investors. Agents estimated that about half the buyers were investors.

Businessman Eric Chung On-shu and his son are among the investors. They own eight flats in Hong Kong and more than 10 on the mainland. They planned to buy a 400 sq ft flat at Lime Stardom for investment. "Property prices will continue to go up as the interest rate is low. And there is no investment alternative better than property investment," Chung said.

Lime Stardom is the second project to go on sale since guidelines were issued by the Real Estate Developers Association and the URA to comply with new government rules intended to increase the transparency of sales and reduce the scope for developers to manipulate prices.

Chung said he was satisfied with sales procedures for the project. "When I bought a flat last year at iHome, a new project, I had to wait in the sales office from the morning until 10pm. But I didn't need to wait so long this time."

Sino Land's The Hermitage provides 964 flats. It has released 661 flats for sale so far. About 90% have been sold, for revenues of HK$7.4 billion (RM3.04 billion).

The developer last Saturday released a further 50 flats, and one with a private swimming pool, for sale next week. The average price of the flats is HK$11,871 per sq ft; the one with the pool will sell for HK$25,060 per sq ft.

Andy Tso, district manager at Ricacorp Properties, said many buyers see the government rules as being intended to improve sales procedures for new projects rather than cool down the property market.

"They worry that property prices will go up more if they miss out on a chance to buy flats," he said.

Wong Leung-sing, an associate director of research at Centaline Property Agency, said the secondary market was boosted by strong sales in new projects.

The company says average property prices on Hong Kong Island rose 2.06% over the past four weeks and prices in the western New Territories increased 2.86%. — South China Morning Post