The buyer clearly stated that "borrowed"
Hong Kong Wen Wei Po (by Lai Chi-tin, Chau Hiu-ching)
The latest Policy Address brings relaxation measures to the property market for the first time in ten years. Benefited by the relaxation of property price upper limit under mortgage insurance plan, two downtown projects, Seaside Sonata in Cheung Sha Wan and Cullinan West III on top of Nam Cheong Station together put on sale totally 453 units yesterday, and until 7 pm last night they respectively sold 110 units and 108 units, accounting for half and 60% of their launched housing units respectively. Some buyers frankly express to use the new mortgage insurance measures to fully borrow loans for investment purposes.
Cheung Kong’ Seaside Sonata in Cheung Sha Wan started the first round sale of 218 units yesterday, and it becomes the first new project to sell after the Policy Address. According to a market source, as of 7 pm, it had sold 110 units, accounting for 50% of the sales. Yesterday, there were three families of the same family spending about HKD57 million to buy 4 units, including 2 two-bedroom units and 2 three-bedroom units, and they are temporarily the largest buyers. As for SHKP’s Cullinan West III on top of Nam Cheong Station, it put on sale 178 units by the form of price list yesterday, and a total of 235 units plus with that in form of tenders. According to a market source, as of 7 pm, it had sold 108 units, accounting for 60% of the 178 units in the price list.
Family customers bought 4 units in Seaside Sonata.
Ms. Li, who was accompanied by her aunt, said that she was the first time to buy a home. She spent about HKD9 million to buy a two-bedroom unit in Seaside Sonata, using the construction period payment plan and paying 20% for the first period, and she has the opportunity to choose the newly introduced mortgage insurance plan. Ms. Li pointed out that the reasons for the purchase are its cheap price and the potential for future appreciation in the district. She lives in a private building in Kwun Tong District and will buy this unit for self-occupation, while it is not excluded that she will use it for investment in long-term, also she is optimistic for the market, besides the current purchasing decision to enter the market is recommended by her aunt.
Ms. Li, who is her aunt next to her, also said that she had had three units in Laguna City, Yau Tong and showed a special preference to Cheung Kong’s properties, also would apply in the next round.
As for Cullinan West III, a prospective buyer, Miss Gao, plans to spend about HKD9 million to buy a two-bedroom unit which is intended for semi-investment purposes. She agrees with the relaxation measures in the Policy Address, and believes that the relaxation of the mortgage insurance plan and the land policy will benefit the future development, also is optimistic about the property market in Hong Kong. As the price of her favorite unit is higher than the upper limit of HKD8 million under mortgage insurance plan in 90%, Ms. Gao said she could not benefit from the new measures of 90% mortgage, but she can still benefit from the mortgage insurance plan in 80% due to the increase of property price upper limit to HKD10 million.
Chiu Kwok-hung said the relaxation of mortgage measure is "timely rain".
The new Policy Address immediately relaxing the upper limit of the property price under the mortgage insurance plan in 80% and 90% is considered to be positive news in the property market. The Executive Director of Cheung Kong, Chiu Kwok-hung described the measure as "timely rain” yesterday, and pointed out that many professionals who have sufficient income was difficult to enter the market due to the expensive down payment in millions of HKD in the past, while many people have the greatest wish to own their own properties, so the new measures will also have a stabilizing effect on the society. He also pointed out that some agents provide feed-back that the second-hand property market was active, with many transactions were recorded on the day before yesterday, especially in the New Territories, and it is expected to break a single-day record in recent years, reflecting that the public is quite affected by the new measures.
In view of that the new housing policies benefit the property market, he expected Seaside Sonata’s next round of sales would be benefited, and it would additionally launch with markup in the short term, also the sales will start next week of the soonest, with the details are still discussed with the URA.
As the Government will quote the Lands Resumption Ordinance to build public housing and develop brownfields, Mr. Chiu responded that the Policy Address is focused on increasing land supply, in the right direction. These measures have no impact on property prices in the short term, but they will ensure that there will be sufficient supply in the future. The public will not have to rush to buy flats. He considers it has a sound effect on property prices and emphasized the Group will be in line with Government’s administration.
Buyers using construction period payment plan increase.
The APAC Vice President and Residential Department President of Centaline Property, Chen Wing-kit also pointed out that, the Policy Address has proposed a number of new housing policies, including raising the upper limit property prices under mortgage insurance plan to provide more choices for the first time buyers, and the market sentiment has also improved, while the relaxation measures also make some buyers change to use construction period payment plan, then to use high-percentage mortgage from mortgages company after house is ready, with the increase in about 10%.
The Chief Executive of the Midland Real Estate Residential Department, Po Siuming also believed the relaxation measures will benefit the trading in property market, and predicted the second-hand property trading in this month to sharply rise to 3,000 cases, at the same time increased the prediction of the second-hand property trading in the fourth quarter to at least 10%, from 8,500 cases to more than 9,000 cases. Po Siuming also revealed that more than 10% of the owners of low cost properties at or under HKD8 million rose the prices by 3%-5% being affected by the measures, and there were also owners decided to close the sales. However, he believes that the new measures will not give a big chance of a substantial increase in overall property prices.