Price cuts dictate secondary sales

Centaline Property Agency reported seven second-hand deals over the weekend, four more than the previous weekend, as homeowners lowered prices and analysts forecast more price cut amid the coronavirus epidemic.

Owners were willing to cut prices under a low-interest environment, after the PBOC had lowered its required reserved ratio in January.

These factors attracted buyers and so the number of transactions rose, it said.

In Ma On Shan, a 736-sq-ft flat at Oceanaire Tower fetched for HK$9.48 million, 9 percent lower than asking price in December after a confirmed case of the coronavirus was reported at the estate.

In Tseung Kwan O, a 533-sq-ft flat at Ocean Shores sold for HK$7.8 million, or HK$14,634 per sq ft, HK$400,000 less than the asking price, according to Midland Realty. The price was a 6-month low for two-bedroom flat at the development.

The number of transactions in the secondary property market in January recorded a low since last September, falling 5.3 percent to 143 at 10 major housing estates, reflecting the trend in December.

Centaline however expects this number to rise in February as several deals were made before the Lunar New Year but not recorded, though deals in March may drop due to the epidemic.

Meanwhile, in the primary market, Henderson Land Development (0012) sold 15 units at The Richmond on Saturday including a 468-sq-ft flat for HK$16.63 million or HK$35,539 per sq ft, a high for the project.

There have been seven cases of forfeiture of deposit among new projects so far this month. Among them, a buyer of a 497-sq-ft flat at Seaside Sonata forfeited a HK$417,950 deposit or 5 percent of the price after canceling the purchase while a buyer of a 286-sq-ft flat at Victoria Harbour in North Point forfeited a HK$530,000 deposit, or 5 percent of the total price, after canceling the purchase.

In the commercial market, Midland IC&I (0459) said the price of grade A offices fell 0.7 percent while rents dropped 2 percent last month. It projects the price and rent will further fall by 5 percent in the first quarter, because of the outbreak.

And the number of transactions for top 50 grade A offices in January hit a two-year low with only three deals were recorded.