2024-05-08 28Hse Editor
(Leung Yuet-kam) The 2023-24 budget will widen the stamp duty band for first-time buyers below $10.08 million and lower the tax rate. The sales brochure of Bal Residence, a single block building in Heng On Street, Kwun Tong, jointly owned by Lai Sun and URA, was uploaded yesterday morning and the first launch of 56 one-bedroom units was announced at an average price of HK$19,554 per square foot, which is expected to be close to the cost per square foot of the property and 15 per cent lower than the price of first-hand units in the same district, at 338 square feet. The 338-square-foot unit is HK$5.8069 million.
First 56 units to be launched at opening price of HK$5.8 million
Bal Residence opened its show flats for public viewing and started collecting votes from 3pm yesterday. Lai Sun Senior Vice President of Development, Julian Poon Yui-man, described the first price list as highly reasonable, with the price per square foot returning to the price of a new property in the same district five years ago. The timing of the launch and sale will be determined based on the response to the receipt of votes.
The project provides 156 units with an area of 300 to 793 square feet, with one-bedroom households accounting for more than 90 per cent. Among them, the first price list has a total of 56 units, with an area of 338 to 349 square feet, all of which are one-bedroom households. After deducting the highest discount of 11.75 per cent, the discounted price ranges from HK$5.8069 million to HK$7.7687 million. All the discounted prices of the units benefited from the new tax system. The discounted average price per square foot is HK$19,554. The developer also offers a construction phase payment plan with a discount rate of 8.75 per cent.
The project was awarded by Lai Sun to the Urban Renewal Authority in 2019 by tender at a premium of HK$883 million per square foot, with a floor price per square foot of about HK$12,300. If we include the 10 per cent inflated gross floor area and the construction cost of about HK$4,000 per square foot, it is roughly estimated that the construction cost alone will be HK$15,000 per square foot. With an 80 per cent take-up rate, the average saleable feet price would have to be $19,000 or more to make a profit. According to the terms of the tender in 2019, the winning consortium is required to pay a dividend to the Urban Renewal Authority in accordance with the tender terms when the sale proceeds of the project exceeds HK$1.38 billion.
As for the asking price of the first batch of units close to the cost price, Pan Ruimin said frankly that the price of the business depends on the market conditions, and the current market conditions are dominated by users. In addition, he believes that the adjustment of the first home stamp duty in the Budget will have a psychologically positive effect on prospective home buyers. Even though interest rates still have a chance to adjust in the short term, I personally believe that they will return to the right track in the long run.
As for the asking price of the first batch of units being close to the cost price, Poon said that the project price depends on market conditions, which are currently dominated by homebuyers. He added that sale price has been determined with reference to the first and second-hand property prices in the same area. In addition, Poon said that the budget's lowering of the stamp duty on first-home purchases will have a psychologically positive effect on potential homebuyers. Although there is still a chance of a short-term adjustment in interest rates, they will likely stabilize in the long term.
Sammy Po Siu-ming, CEO of Midland Realty’s residential division for Hong Kong and Macau, said that the first batch of Bal Residence's discounted average price per square foot is about 15 per cent lower than the price of first-hand flats in the same district, reflecting the developer’s prioritization of volume over price, with a project completion period of about one year (the estimated launch date is the end of March 2024). This is believed to attract not only users and car buyers, but also long-term investors.
Centaline Property's Southeast Central Kowloon regional sales director, Ken Lee, said that the discounted price of all the units in the project is below HK$8 million, and will likely draw more buyers thanks to the first-time buyer's stamp duty concessions in the new fiscal budget. One-bedroom units at the end of the large new developments in the area have already been sold out, which can attract branch families and homebuyers in the district to enter the market.
KOKO ROSSO 43.5 times over-registered
The first round of sale of 148 units at KOKO ROSSO in Lam Tin by Wheelock Properties closed at 8pm last night and received a total of 6,594 votes, 43.5 times over-registered. The units, ranging in size from 268 to 497 square feet and comprising one to two-bedroom units, are available for sale tonight at a discounted price of less than HK$9 million.
In terms of new property transactions, Kerry Properties' Mont Rouge sold by tender yesterday a 1-storey flat A and flat B in Block 1, measuring 1,743 and 1,683 square feet respectively, each with a parking space, for HK$75.68 million and HK$73.08 million, at HK$43,419 and HK$43,422 per square foot respectively. It is noted that the buyers were the same group of customers.
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