New Kai Tak flats priced at eight-year lows

Staff reporter and Bloomberg

The Pavilia Forest at the old Kai Tak airport runway unveiled its price list yesterday, offering 60 flats at prices starting from HK$3.86 million.

The average price is approximately HK$17,188 per square foot, the lowest in Kai Tak's middle-class neighborhood in eight years as competition intensifies amid high inventories.

Developed by New World Development (0017) and Far East Consortium International (0035), the first list offers seven three-bedroom, 38 two-bedroom and 15 one-bedroom units.

Discounted prices range from HK$3.86 million to HK$9.87 million or HK$16,008 to HK$19,690 per sq ft.

The cheapest unit is a one-bedroom flat located in Tower 6, on the second floor with an area of 234 sq ft and an additional 30-sq-ft terrace. Its discounted price is HK$16,513 per sq ft.

Buyers opting for a special plan can enjoy discounts of up to 16 percent off, by which the developer provides designated tenants for buyers. The lease term is two years with an annual rental income of 3.5 percent of the property price, paid semi-annually.

The project plans to open its show flats to the public and accept checks from Saturday.

Louis Chan Wing-kit, the Asia-Pacific vice-chairman of the residential division at Centaline Property, said that the project is priced about 10 percent lower than second-hand homes in the same area and nearly 30 percent lower than unsold homes nearby, making it highly attractive.

Chan noted that last month's primary market sales was disappointing, but with the launch of The Pavilia Forest and several other new projects in the pipeline, it is expected that this month's primary market sales could reach the 1,000 mark.

Despite the fading stimulus from the removal of stamp duties in the real estate market, overall transactions in the first half of the year have increased.

A total of 35,089 sales and purchase agreements of building units for registration was recorded during the first half of the year, up by 0.8 percent from a year earlier, data from The Land Registry showed.

The total consideration for these agreements for the first half, however, dropped 4.2 percent from a year ago, affected by low-priced new projects and declining home prices.