Advertisement

K Wah International gloomy about Hong Kong property as it reports profit slump

Firm says first-half sales fell 16pc to HK$3.31b and warns that city's home prices could fall 20pc because of government's cooling measures

Reading Time:2 minutes
Why you can trust SCMP
Lui Che-woo, chairman of K Wah International. Photo: Sam Tsang

K Wah International forecasts Hong Kong property prices to fall 10 per cent to 20 per cent if the government keeps its cooling measures in place.

Advertisement
"Property prices will drop," the firm's chairman, Lui Che-woo, said yesterday while announcing half-year earnings that included a 16 per cent drop in revenue.

"The government's cooling measures are aimed at lowering prices so that people can buy their own flats. But the cost of construction is rising. We hope the government releases more sites for sale, in order to lower land costs. It would help us to offset the impact of rising development costs."

The company said its net profit plunged 69 per cent to HK$888 million in the first half as sales dropped to HK$3.31 billion.

Executive director Alexander Lui Yiu-wah said he expected the luxury residential market to be "quiet" over the next two years.

Advertisement

K Wah generated HK$3.1 billion from contracted sales in the first half, of which some HK$1.8 billion were booked in the period.

The company plans to increase its investment property portfolio from 120,000 square metres to 200,000 sq m over the next three to five years.

loading
Advertisement