Hong Kong developers keep discounted flats coming as they pare inventory amid rate hopes

Henderson Land, Right Honour and Sun Hung Kai unveil price lists for new units as builders see hopes of lower interest rates lifting buyer sentiment

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A View of Sun Hung Kai Properties’ Novo Land development in Tuen Mun, Hong Kong, on June 7, 2024. Photo: Edmond So

Published: 5:00pm, 7 Jun 2024

Hong Kong developers continue to hasten sales of new residential projects at discounts to reduce inventory while growing optimism that interest rates will fall this year buoys buyer sentiment.

Two price lists were unveiled this week for sales starting next week: The Haddon, which is phase four of Henderson Land’s Midtown South residential project in Hung Hom, and The Highline in Kennedy Town, developed by Right Honour Investments under the Shanghai Commercial Bank. Sun Hung Kai Properties plans to release a price list within the next week for phase 3B of Novo Land in Tuen Mun, with no sales date yet announced.

The Hong Kong Monetary Authority is due for its next rate decision on June 13, in lockstep with the US Federal Reserve. Although no change is expected at that meeting, more traders expect the Fed to cut rates twice in the remaining months of 2024, according to CME Group.

Meanwhile, the Hong Kong property market has an excess of completed and unfinished unsold units, although the stock declined by 3.6 per cent in May to 21,102, compared with the end of last year, according to Midland Realty. Analysts expect developers to continue with their sales strategy of offering flats at discounts to pare the supply.

Henderson Land released the first price list of 92 units at The Haddon on May 30, with an average price of HK$19,280 (US$2,469) per square foot. The list includes 72 one-bedroom units, 15 two-bedrooms and five three-bedrooms flats. Prices after discounts range from HK$4.81 million to HK$8.52 million, or HK$18,368 to HK$20,615 per square foot.

Compared with the average price in the first price list of its previous phase, Baker Circle Greenwich, in July last year, the developer has raised the average price by 1.9 per cent.