Tuesday, February 8, 2011

Hong Kong housing estates breaking ’97 price peak

Sales prices in four major housing estates in Hong Kong surpassed previous records set in the boom of 1997, the South China Morning Post has reported.
Despite volume of sales dropping to their lowest levels in two years, sky high prices don’t look like they’re going to ease any time soon.
Sales data from agency Midland Realty showed that prices in City Garden, Westlands Court, Chi Fu Fa Yuen in Pok Fu Lam, and Whampoa Garden in Hung Hom all broke 1997 records last month. Another estate, Taikoo Shing, broke its 1997 sales price record in September of last year and continued rising in January.
The average price of sales in City Garden in North Point rose to HK$8,879 (US$1,141) per square foot last month, 11.2 per cent higher than the HK$7,984 (US$1,026) per sq ft average achieved at the market peak in 1997 before the Asian financial crisis triggered a collapse in property prices. At Westlands Court the average selling price of apartments last month was HK$6,756 (US$868) per sq ft , 9.8 per cent higher than the HK$6,154 (US$791) per sq ft average recorded in 1997; in Taikoo Shing prices reached HK$8,702 (US$1,118) per sq ft or 2.9 per cent higher than the average set in 1997; in Chi Fu Fa Yuen the average transaction price last month rose to HK$6,531 (US$39) per sq ft, 1.1 per cent above the average recorded in 1997; and prices in Whampoa Garden reached an average of HK$5,146 (US$661) per sq ft, 3.4 per cent higher than the average peak in 1997
“Average transaction prices in another 13 housing estates are now just 10 per cent below the market peak in 1997. If the rally were to continue we will not rule out the possibility of more housing estates joining the league,” said Anita Cheung Pui-lui, Midland Realty research manager. But the rise of property prices could be slowed if the government installed new cooling measures, Cheung said. In November the additional stamp duties were imposed on homes resold within two years, which caused many leading developers to delay the launch of new projects.
But despite the continued price rise, sales volume of new homes dropped to its lowest level in two years according to data compiled by estate agency Hong Kong Property. Based on data released by the Land Registry, it says there were 310 preliminary purchase agreements signed last month, the lowest since January 2009 and down 35 per cent from 475 registered transactions in December last year, it said.The total value of registered transactions for new apartments showed a month-on-month 27 per cent decline to HK$4.11 billion (US$528 million) last month from HK$5.63 billion (US$723 million) in December.
“The drop is mainly because of developers postponing the marketing of new projects after the government’s anti-speculative measures,” the agency said.
Despite the decline in sales volumes, Hong Kong Property said last month’s overall average value per transaction was HK$13.25 million (US$1.7 million), about 12 per cent higher than last month’s HK$11.85 million (US$1.52 million). Boosting last month’s outcome, it said, were several luxury apartments sold for more than HK$100 million (US$12.85 million) each.
On Hong Kong Island, average transaction value for a new apartment was HK$37 million (US$4.75 million), up 20 per cent from HK$30.99 million (US$3.98 million) in December and average transaction prices in the primary market in Kowloon was HK$9.39 million (US$1.2 million) last month, 4.8 per cent higher than December.
The Land Registry said there were 8,002 registered transactions in the overall residential market last month, 14.28 per cent lower than December and 24.9 per cent down on the same month last year.

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