New World sells HK apartments at lowest price in eight years

HONG Kong developers New World Development and Far East Consortium International are selling a residential project at the lowest price in eight years for the district, as competition for buyers intensifies amid high inventory.

The pair is marketing the first batch of apartments in The Pavilia Forest I at an average of HK$17,188 (S$2,975) per square foot, the cheapest in the middle-class neighbourhood of Kai Tak in eight years, according to Midland Realty.

The pricing also represents an almost 30 per cent discount to other projects in the area.

New World and Far East face a challenge to sell the units quickly when other builders are also offering discounts to clear their stockpiles.

Home sales in the city have resumed falling as stubbornly high borrowing costs deter homebuyers even after extra taxes were scrapped earlier this year.

First-hand home transactions plunged 73 per cent in June from a peak in April despite developers’ pricing-cutting strategy.

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New World, controlled by billionaire Henry Cheng’s family, is seeking to raise cash by selling assets to trim its leverage, which is higher than its biggest Hong Kong peers.

The company expected to complete the sale of HK$8 billion of non-core assets by the end of June, Bloomberg News reported last week.