Hong Kong developer Wang On prices Finnie in Quarry Bay at 3-year low, 32% discount

A Hong Kong developer has priced a new residential project in Quarry Bay a third lower compared with three years ago, as builders test the market’s appetite amid weak sentiment.

The batch includes 20 one-bedroom and 10 two-bedroom flats, with areas ranging from 245 sq ft to 364 sq ft. After applying the maximum 15 per cent discount, the prices of the units range from HK$4.29 million to HK$7.58 million, or HK$17,502 to HK$21,014 per square foot.

All one-bedroom units are priced below HK$5 million, the developer said.

Wang On said it plans to kick off sales as soon as next week, adding that the launch of the next batch will depend on the market’s response.

“The project is located next to [Taikoo] MTR station, and with its proximity to the Taikoo Place business district, I believe the project will attract young buyers and long-term investors,” said Jimmy Lee, director of Midland Realty. “The project is likely to generate a rental rate of return of between 4 per cent and 5 per cent, or HK$90 to HK$95 per square foot.”

With no new supply in the Taikoo Place area for many years, the initial price list is about 20 per cent lower than unsold units in the same neighbourhood, said Lee, adding that this should boost the appeal of the project.

Louis Chan Wing-kit, CEO of the residential division of Centaline, said the high probability of an interest-rate cut in the US next month, could rekindle home-buying interest among prospective buyers.

“Second-hand transactions have already taken off, and we’ve seen dozens of transactions of first-hand inventory units every day. The overall atmosphere is building up,” he said.

Chan said that as developers were starting to speed up the pace of sales, the glut of new supplies could lead to a new round of discounts.

He said he expects 1,300 transactions in the primary market this month.