Dearth of new flats drives secondary high

The number of secondary-market transactions in 10 major housing estates over the weekend hit a 43-week high as sellers cut asking prices to clinch deals before the new year.

A total of 17 deals were recorded in the estates, up by 41.7 percent from a week earlier, according to data from Midland Realty.

But the figure only inched up by one to 18 cases if the sales made on New Year's Day were also counted, Midland said.

That means transactions over the three-day holiday were 38 percent lower than a year ago.

Three estates on Hong Kong Island saw five deals over the weekend, unchanged from a week earlier, while the four in Kowloon altogether recorded a total of six deals, tripling that of the previous weekend.

The number of sales in the three estates in the New Territories also increased by 20 percent to six.

In December, transaction numbers in the top 10 estates rose by 5 percent from November to 147 cases, Midland noted.

Centaline Property Agency also saw a 16.7 percent rise in deals at these blue-chip estates to 14 - the highest in 35 weeks - at the weekend and 16 over the long holiday.

The secondary market remained the focus of the market with no new big project being put on the market over the weekend but the existing home market will be under pressure for a while as developers are expected to actively promote sales at competitive prices to destock, said Sammy Po Siu-ming, chief executive of Midland's residential division for Hong Kong and Macau.

Po also called on the government to remove all cooling measures for properties in the upcoming budget announcement next month.

The gains came as a 670-square-foot flat at Tierra Verde in Tsing Yi was sold for HK$10.06 million, or HK$15,015 per sq ft yesterday, according to Ricacorp Properties.

The vendor who purchased the three-bedroom unit for HK$9.7 million gained HK$360,000 on paper but is expected to lose around HK$200,000, or around 2 percent from the deal if all the expenses are taken into account.

In Mong Kok, One Soho, developed by Sino Land (0083), sold two flats yesterday.

The units, which came with an area of 320 sq ft, were sold for HK$6.25 million and HK$5.98 million, or HK$19,543 and HK$18,688 per sq ft.