Hong Kong’s biggest developer sells homes at 6-year-low price

Hong Kong - Sun Hung Kai Properties, Hong Kong’s biggest developer, has lowered the floor for new home prices in the city.

The first batch of units in its Yoho West development has an average price of HK$10,888 (S$1,870) per sq ft – a six-year low for new homes, according to local newspaper Sing Tao. Developers have been facing mounting pressure to cut prices as Hong Kong’s property market continues to suffer under high interest rates.

The low pricing by the city’s leading developer also shows that the

government’s recent measure to cut property taxes

is insufficient to lift the market. Major project launches in the two weeks following the announcement in late October recorded only an average first-day sell-through rate of 24.6 per cent, compared with 73.9 per cent in the third quarter, according to property agency Jones Lang LaSalle.

As mortgage burdens deter buyers, developers have become more cautious in acquiring new projects. Earlier in November, a residential site in the Tung Chung area near the airport did not receive any bids for development – the first time in a decade – reflecting builders’ pessimism.

Nonetheless, Sun Hung Kai’s management remains positive.

Interest rates are likely to peak and fall in the first quarter of 2024, which will help boost the property market, Sun Hung Kai deputy managing director Victor Lui said at a press conference about the project on Nov 20.

There are 280 apartments available for sale at Yoho West. The company expects the units to attract first-time home buyers and small families to the Tin Shui Wai area in north-west New Territories. BLOOMBERG