Hong Kong apartment project sold out in a day as slump fades

HONG Kong’s biggest developer sold hundreds of new apartments in a day, the latest sign that the housing market is recovering from last year’s slump.

Sun Hung Kai Properties offloaded all of the 352 homes for sale in its Novo Land project on Saturday (Mar 4) for more than HK$2 billion (S$342.6 million), according to the developer. Meanwhile, Wheelock Properties sold 304 units in its Koko Rosso development in 10 days, accounting for about 99 per cent of those available for purchase, the company said.

The reopening of the border with mainland China and the removal of mask mandates in Hong Kong have boosted buyer confidence, said Sammy Po, chief executive officer of the home division at Midland Realty. Po expects new-home sales to surge to about 2,800 this month, the most for March in four years. There were 643 first-hand residential transaction registrations in February.

Sales of new homes tumbled last year to the lowest since 2013 as rising interest rates and Covid measures weighed on the market. Improved confidence locally and the potential influx of buyers from the mainland may prompt developers to launch more projects in the new year. Primary residential transactions could surge more than 50 per cent to HK$175 billion this year after retreating 52 per cent in 2022, according to Bloomberg Intelligence.

“Over the next few months, more developers will plan to speed up their launches, especially for mass residential units,” said Patrick Wong, a real estate analyst with Bloomberg Intelligence. “This may be a good time to sell more units before further mortgage rate hikes” potentially take place later this year as the US Federal Reserve raises rates, he said.

Sun Hung Kai plans to focus on marketing projects in the Pak Shek Kok and Tin Shui Wai areas after finishing the sale phase of Novo Land. Shares of the developer rose as much as 2.3 per cent on Monday morning in Hong Kong.

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The secondary residential market is also improving. Prices for used homes rose by almost 5 per cent since the beginning of the year after a 16 per cent decline in 2022, data from Centaline show. BLOOMBERG