Heavy rain puts a damper on buyer interest in second stage of The Uppland in Tuen Mun, say agents

Heavy rain in Hong Kong put a damper on a property sale in the New Territories on Saturday, despite steep discounts.

Early Light International Holdings, a property developer owned by tycoon Francis Choi Chee-ming, staged the second launch of The Uppland at Gold Coast Bay in Tuen Mun. Some 97 of 139 flats on offer were sold by 2pm Saturday, according to real property agents.

The second round of sales comprised of 87 studios, 20 one-bedroom, 27 two-bedroom, and five three-bedroom units, priced between HK$2.23 million (US$285,641)) and HK$7.76 million after discounts, or HK$8,768 to HK$14,051 per square foot. The average price of the units was about 10 per cent cheaper than a project launched last month in the same neighbourhood.

The average price after discounts was HK$11,126 per sq ft, higher than the HK$10,209 per sq ft in the first round of 188 flats.

“We predict Gold Coast Bay The Uppland will sell over 100 units today. The heavy rain and Olympic Games will lower the incentive for flat viewing this weekend,” said Louis Chan Wing-kit, chief executive officer of Centaline Property Agency, the real estate agency’s residential division.

The Uppland had received over 7,900 applications earlier this week, for the 139 flats, making them nearly 57 times oversubscribed. The development offers a total of 1,323 flats in the first phase, with The Uppland supplying 692 of these units.

The turn out was “not too bad” on Saturday, with about 80 per cent of the units expected to sell, said Sammy Po Siu-ming, chief executive officer of the residential division at Midland Realty, one of Hong Kong’s biggest network of real property agents.

The developer sold all 188 flats during last weekend’s sale, but interest has cooled off in this second round, Po added.

The supply of new flats in the city is expected to soar to 112,000 in the next three to four years, according to estimates by the Housing Bureau, while demand is dwindling under interest rates that remain at a 23-year high and a slowing economy.

As buyers increasingly anticipate interest-rate cuts by the US Federal Reserve in mid-September, Hong Kong’s property market may see some relief. Earlier this month, Fed Chairman Jerome Powell pointed to signs of a softening US labour market and a slowdown in inflation.

Hong Kong, which has some of the most expensive property in the world, could get a boost from a rate cut, as the city’s monetary policy is in lockstep with the US Fed to maintain the local currency’s peg to the US dollar.

Chan of Centaline expects a rebound in the property market in July on rising expectations about an interest-rate cut by the Fed, with new-home sales to almost double from the previous month to 1,300 deals.

Centaline anticipates home prices may drop 3 per cent in the third quarter and will probably rebound by between 3 and 5 per cent in the following three-month period if the local monetary authority cuts rates in lockstep with the Fed.