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HK land auction draws high price
By Jimmy Tsim and Lee Chyen Yee |
September 1, 2010, Wednesday
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Print Edition
Print Edition
HONG Kong sold a piece of land yesterday at a price that was a third above forecasts, indicating that the city's property sector could still be frothy even after cooling measures were announced weeks ago.
The government has been selling land at higher-than-expected prices over the past few auctions as demand for posh apartments has been holding up well in Hong Kong due to low interest rates, purchases from rich Chinese mainlanders and Asia's strong economy.
Sharp rises in housing prices in Hong Kong, a trend seen in many Asian cities, has prompted the government to roll out measures this year, including lowering the mortgage loan ceiling for apartments priced at HK$12 million and above.
The government sold the site on Ede Road, in Kowloon, with an area of about 2,399 square meters, for HK$1.285 billion (US$165 million). Kerry Properties won the bid.
Analysts had expected the land to sell for HK$960 million, the government's sixth auction this year and part of its efforts to cool the red-hot market by raising housing supply.
"This is mainly a traditional luxury district and I guess the developer is seeing demand on the luxury front is still very strong and is unlikely the government will be able to do anything," said Cusson Leung, director of equity research at Credit Suisse.
Trevor Cheung, a property analyst at BNP Paribas, said Kerry Properties would likely build 20 luxury apartment units.
The government has been selling land at higher-than-expected prices over the past few auctions as demand for posh apartments has been holding up well in Hong Kong due to low interest rates, purchases from rich Chinese mainlanders and Asia's strong economy.
Sharp rises in housing prices in Hong Kong, a trend seen in many Asian cities, has prompted the government to roll out measures this year, including lowering the mortgage loan ceiling for apartments priced at HK$12 million and above.
The government sold the site on Ede Road, in Kowloon, with an area of about 2,399 square meters, for HK$1.285 billion (US$165 million). Kerry Properties won the bid.
Analysts had expected the land to sell for HK$960 million, the government's sixth auction this year and part of its efforts to cool the red-hot market by raising housing supply.
"This is mainly a traditional luxury district and I guess the developer is seeing demand on the luxury front is still very strong and is unlikely the government will be able to do anything," said Cusson Leung, director of equity research at Credit Suisse.
Trevor Cheung, a property analyst at BNP Paribas, said Kerry Properties would likely build 20 luxury apartment units.
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