The expanding novel pneumonia epidemic, dull property market, and citizens' mentality of cashing out for self-protection have caused many losses or abandoned transactions. A four-bedroom unit in The Zumurud, Ma Tau Kok, which had been handed over not long ago, should have been sold with loss. But the buyer canceled the transaction due to the pneumonia diagnosis earlier this month. The estimated loss will be more than HKD3.5 million.
■ Journalist: Lai Chi-Tin
According to the data of Land Registry, a low-rise four-bedroom unit B in block 1 of The Zumurud, Argyle Street, with the area of 1,687 sq ft, should have been sold for HKD29 million at the beginning of January. But the related transaction registration was canceled because more and more novel coronavirus pneumonia cases appeared at the beginning of February. Market participants estimate that there is more likely for the new buyer to abandon the transaction. The loss will be above HKD3.5 million, including deposits and commissions.
A buyer loses more than HKD3.5 million.
It is reported that the original owner purchased it for HKD34.839 million in October 2016, and chose the payment plan of "Z138 pay-after-occupation" with a transaction period of up to 12 years. However, the buyer changed to construction period payment in April 2017, adjusting the transaction price to HKD36.673 million. Thus, the original owner loses book profit of about HKD7.673 million or over 20% after more than three years, based on the current second-hand transaction price of HKD29 million. However, the actual amount of the loss is unknown, since the buyer could enjoy the cash rebate from the developer at that time.
One East Coast firstly recorded a second-hand property transaction with loss.
According to a market source, One East Coast in Yau Tong also recorded the first second-hand property transaction with loss. It is a middle-rise room E in Block 1A with an area of 295 sq ft, sold for HKD5.7 million last month, with the sq ft price at about HKD19,322. The original owner bought it in May last year for HKD6.34 million as a first-hand buyer, and the book loss was 10%. Moreover, there is an additional stamp duty of 15% must be paid since it has not passed the SSD period. However, it is unknown who between the new buyer and the owner would pay this tax involving HKD855,000.
A ground unit including a garden in block 2 of One Mayfair in Sai Kung, with an area of 986 sq ft and garden in 825 sq ft, was sold for HKD17 million recently. The book profit loses about HKD1.05 million compared with the purchase price of HKD18.05 million in 2016. And the price is about 15% lower than the market level.
Seaside Sonata re-recorded one abandoned transaction.
There have been about seven abandoned first-hand property transactions since February, due to the expansion of the novel pneumonia epidemic. The latest is one abandoned transaction in Cheung Kong's Seaside Sonata in Sham Shui Po. The transaction record book shows that the potential buyer has canceled the transaction of room B on the 9th floor of Block 1, with the area of 497 sq ft. It should have been sold for HKD8.359 million on February 2. It is expected that the 5% deposit that is about HKD0.42 million will be confiscated.
The top floor unit in Sino Centre lost over HKD1.7 million.
There are also loss transactions for commercial properties. According to the Land Registry, a whole top floor unit in Sino Centre was sold for HKD40 million at the end of last year, with the sq ft price of only HKD8,615 based on the whole floor area of 4,643 sq ft. The sq ft price is a new low in near five years. The original owner bought it for HKD40 million in October 2012, earning no profit after holding it for more than seven years. The loss is over HKD1.7 million or more than 4%, calculating the stamp tax of 4.25% and the incidental expenses.
