(HONG KONG) Hong Kong existing home sales rose last week and Sino Land sold almost 60 per cent of the new apartments at its Palazzo development in the city's Shatin district, as low interest rates spurred demand for housing.
Thirty-five of Hong Kong's biggest private developments recorded 178 sales of existing residences between May 5 and May 11, up from 173 a week earlier, according to figures compiled by Midland Holdings Ltd, the city's biggest publicly-traded real estate agency.
Mortgage costs in Hong Kong have fallen below the inflation rate this year, fuelling a property boom. Average prices for residential apartments smaller than 1,000 square feet rose 15.6 per cent in the first quarter from the end of 2007, according to Vigers International Property Consultant Ltd.
'This really shows the strength of the fundamentals in the property market,' said Buggle Lau, chief research analyst at Midland. 'Normally when a big project like the Palazzo goes on the market you'll see secondary apartment transaction falling.' Sino Land, Hong Kong's fifth-biggest builder by market value, sold more than 800 apartments at its Palazzo project in the first four days after May 9 when sales started, said Una Lau, a spokeswoman for Sino Land.
Hong Kong developers begin selling apartments while they are being built.
Sun Hung Kai Properties Ltd, the city's biggest builder, and Henderson Land Development Co also sold 18 apartments at the Harbour Place project in the Hung Hom district last weekend, Hong Kong-based newspaper Ming Pao reported yesterday. Fiona Wan, a spokeswoman for Sun Hung Kai, didn't immediately return calls from Bloomberg seeking comment.
Existing home transactions rose 22 per cent to 361 in April from a month earlier, according to Centaline Property Agency Ltd. It was the sixth consecutive month that transactions exceeded 200, the agency said in a statement.
The Hang Seng Property Index, which tracks the share prices of the six biggest Hong Kong-listed developers, has gained 23 per cent since March 21, cutting its loss in 2008 to 17 per cent.
Sino Land has lost 27 per cent this year, Sun Hung Kai, the city's biggest builder by market value, has fallen 18 per cent. Henderson Land has dropped 20 per cent. -- Bloomberg
This article was first published in The Business Times on May 15, 2008
