Flats on sale at Mori in Tuen Mun received a warm response and were heavily oversubscribed at the weekend despite major lenders' mortgage rate hikes.

The project, which is being jointly developed by Road King Infrastructure (1098) and Shenzhen Investment (0604), was 16 times oversubscribed after attracting more than 2,500 checks for the 140 units in the first batch of sales.

Homes cost from HK$3.13 million to HK$8.24 million after discounts, or HK$9,168 to HK$12,336 per square foot.

The average discounted price of HK$11,088 per sq ft is about 11.4 percent cheaper than the first price list of Grand Jeté's Phase 2 in the same area in March but slightly higher than that of THE CARMEL launched in January 2019.

The second batch and the sales arrangement will be announced soon, the developers said, adding that they had partnered with a mortgage broker to offer a variety of mortgage packages with mortgage rates as low as 3.625 percent and up to 2.8 percent for a cash rebate.

With market attention on the primary market, second-hand home sales remained sluggish with only six deals recorded in the 10 biggest estates over the weekend, an agency said.

That was seven deals or 53.8 percent fewer than the previous weekend.

An agent from the agency said rising mortgage rates and the upcoming Federal Reserve meeting also weighed on sentiment.

China Construction Bank (Asia), a relatively small player in the mortgage market, is to lift the mortgage rate by 1.5 percentage points to 5.125 percent today, meaning a nearly 20-percent rise in the monthly repayment for new loan applicants.

That will be much higher than the 0.5 percentage point hike by major banks like The Hong Kong and Shanghai Banking Corporation and Bank of China Hong Kong (2388).

The new rate of 4.125 percent will be applied to new loans for existing homes from today and uncompleted homes from September 30.

(The Standard)

PGIM invests in Hong Kong, mainland China, Australia rental property markets, betting on their strong fundamentals, discounted assets

There is a growing need for rental housing especially in cities where the cost of residential buying has become really high, according to PGIM

The property markets in mainland China, Australia and Hong Kong are in different stages of the real estate cycle, but have high rental growth potential

PGIM Real Estate has invested US$400 million in the housing rental markets in Hong Kong, mainland China and Australia, as the US asset manager sees huge growth in these segments and opportunities to snap up assets at deep discounts amid a challenging business environment.

“The living sector has increasingly become a big thing for us,” said Benett Theseira, managing director and head of Asia-Pacific, at PGIM Real Estate. “Increasingly we see this growing need for rental housing, and especially in cities where the cost of residential buying has become really high. And because of that we see this growing need for residential rental housing in cities like Singapore, Hong Kong, Shanghai, and in Sydney and Melbourne in Australia.”

“Hence the opportunity to invest in that provides a good investment return and also the opportunity to provide a product to this demographic of young professionals … so we can contribute to creating a good quality product and affordable product for them, which is why we went well into the sector,” he added.

In mainland China, PGIM Real Estate has partnered with a domestic rental flat operator to acquire a 19-storey purpose-built flat building in Shanghai. The property comprises over 500 flats and provides common areas and facilities including a gymnasium and a resident’s lounge.

In Australia, PGIM has formed a joint venture with a property developer to develop a portfolio of residential properties for rent in major cities to ease a hugely undersupplied housing market. The partnership aims to have a portfolio of as many as 1,250 flats, according to PGIM.

Two seed assets have been acquired, one in Brisbane and the other in Sydney, and the two neighbourhoods were chosen for their status as employment and entertainment hubs. The assets have about 300 small flats each.

Those acquisitions followed deals in Hong Kong, where PGIM acquired two hotels last year with the aim of converting them into co-living flats this year.

The Rosedale Hotel has been converted to Weave Studios Kowloon West with 435 fully furnished studio flats over 29 floors, while the Travelodge Central has been converted to Dash Living on Hollywood. Located near the Olympic MTR station, the Weave Studios property launched operations in May and is now 80 per cent occupied. Dash Living on Hollywood, which opened in July, is now about 30 per cent occupied, PGIM’s Theseira said.

The three property markets are in different stages in the real estate cycle, but share one crucial element that made them attractive – high rental growth.

In mainland China, for example, the median house prices in major cities were about 30 times the average annual household income. The current uncertainty in the property market in the world’s second-largest economy is also spurring the growth rate in the rental market to high single digits, Theseira said. The turmoil is also spurring asset owners to offer properties at a 20 per cent to 30 per cent discount in some cases.

“Discounts are not uncommon,” Theseira said. “And certainly focusing on the strong demand for rental housing is where we see the opportunity. We are picking the right assets that will benefit from the recovery in value when market conditions improve.”

Meanwhile, Hong Kong remains one of the world’s most unaffordable housing markets and the current high interest rate environment, currently at levels last seen in February 2008, is also making potential homebuyers cautious and they are instead opting to rent.

Australia, with its strong immigration growth, high interest rates and median home prices about 10 times household income is also forecast to see rental market growth of high single digits, Theseira said.

“We found that the structural drivers were very favourable, particularly in China and Australia,” he said.

In the short-term, Theseira said Singapore is another rental market that the group finds attractive and with monetary authorities likely to start easing by the latter part of 2024, the group is also looking to be more active in its investment in the region.

In mainland China, the co-living segment is a “highly viable property segment”, a property agent said.

“Rental housing properties have continued to gain traction at a resilient pace in mainland China over the past few years, underpinned by China’s favourable demographics, stretched housing affordability, as well as people’s growing awareness and acceptance of renting,” the agent said. “In addition to those robust demand fundamentals, China’s rental housing sector has also benefited from the country’s encouraging policy support including dedicated land supply, tax incentives and financial support.”

(South China Morning Post)

Hong Kong home price seen falling by 5 per cent after 7 major lenders including HSBC, Standard Chartered set to increase mortgage rates

The effective mortgage rate for new loans from HSBC, Hang Seng, BOCHK, Standard Chartered and BEA will rise by 50 basis points on Monday

The higher mortgage rates will pressurise home prices to fall by 3 to 5 per cent in the next few months, property agents say

Hong Kong home prices are set to fall by about 5 per cent by the end of this year, analysts say, after seven major lenders, including the three note-issuing banks – HSBC, Standard Chartered Bank, and Bank of China (Hong Kong) – said they will raise their mortgage rates as early as Monday.

The trio, together with Hang Seng Bank and Bank of East Asia from will increase mortgage rates for new loan applications by 50 basis points on Monday, while Citibank will make a similar increase on Wednesday (September 20), the lenders’ spokesmen said in a reply to the Post’s inquiries.

The effective mortgage rate for new loans by these six lenders, which control 80 per cent of the mortgage market, will be increased from 3.625 per cent to 4.125 per cent. Existing home loans will not be affected.

The payment on a typical HK$5 million (US$643,000) mortgage over 30 years will increase by 6 per cent after the mortgage rate increases, or by HK$1,430 per month to HK$24,232, according to calculations made by a mortgage broker.

China Construction Bank (Asia) went even further in increasing its mortgage rates for new loans. It plans a 1.5 percentage point rise starting Monday, from 3.625 per cent to 5.125 per cent, according to the mortgage broker which was citing market sources. The Post’s calls to the lender, which has a 0.3 per cent share in Hong Kong’s mortgage market, went unanswered.

“The mortgage rate rise is going to further hit the already weak property market in Hong Kong. High borrowing costs will discourage people from buying new homes at the moment,” a property agent said.

“The increase in mortgage rates will lead home prices further down by 3 to 5 per cent in the next few months.”

Hong Kong’s lived-in home prices declined for a third straight month in July to a six-month low, as the city’s property market continued to struggle in an elevated interest-rate environment. Prices fell 1.1 per cent month on month in July, the biggest drop this year, according to an index compiled by the Rating and Valuation Department.

The total number of property transactions – including new and second-hand homes, commercial buildings and car parks – dropped for a fourth consecutive month in July, declining 7.6 per cent from June to 4,777, according to a report released by a property agency last month. That is the lowest figure in seven months.

“It is highly likely the home prices will decrease over 3 per cent in the following months, offsetting all gains this year,” an agent said. “The home price this year will be flat this year when compared with a year earlier.”

A prolonged high-interest rate environment, slow income growth in Hong Kong and falling property prices in mainland China are likely to keep affordability pressures beyond this year, Goldman Sachs (Asia) analysts Gurpreet Singh Sahi, Wing Huang and Simon Cheung wrote in a report on Friday.

“The latest raise would pressure affordability further,” the Goldman Sachs analysts said. “Hence, we reverse our call for a price improvement in the residential market this year to a flat outcome versus an increase of 5 per cent outlook before.”

Goldman Sachs also expects home prices to remain flat in the following two years and to increase only in 2026 by 4 per cent.

The plans by major lenders to increase mortgage rates comes ahead of the US Federal Reserve meeting later in the week, where analysts widely expected a pause in its rate rising campaign, given the rosier inflation picture.

The Hong Kong Monetary Authority in July raised the city’s base rate, lifting it for the 11th time in the past 17 months by a total of 5.25 percentage points, in lockstep with the Federal Reserve. Hong Kong’s monetary policy follows that of the United States, as the city’s currency has been pegged to the US dollar since 1983.

Commercial banks raised their prime rate five times since September last year by a total of 0.875 percentage points. BOCHK, HSBC Holdings, and its subsidiary Hang Seng Bank now have their prime rates at 5.875 per cent, while those at Standard Chartered Bank, Bank of East Asia, Citibank, and CCB Asia are at 6.125 per cent. These levels were last seen in December 2007.

“Hong Kong lenders may still increase the prime rate this week as the interbank rate is high,” the mortgage broker said. “The US may also further increase the interest rate in November,” he added, reflecting the market expectations that authorities will keep at least one rate hike on the table.

The one-month Hong Kong interbank offered rate (Hibor), the benchmark for mortgages, rose to 5 per cent on Friday, compared with 4.7 per cent last month and 4.2 per cent at the beginning of this year, according to Hong Kong Association of Banks.

The three-month Hibor, which is linked to corporate loans, stood at 5 per cent on Friday, while the six-month Hibor reached 5.18 per cent, and the 12-month Hibor advanced to 5.4 per cent on Friday. All three benchmarks are 50 basis points higher than three months ago.

“We have decided to revise our mortgage rate following a recent review, which takes into account a range of factors, including Hibor, our competitiveness and market pricing,” a spokesman of HSBC said.

(South China Morning Post)

中環貴重物業受捧 老牌家族頻出手

現時經濟不景，惟中環區貴重物業仍然受捧，近日錄大額舖位成交，高價出乎市場人士意料，區內車位推售亦隨即獲承接，買家皆為老牌家族成員，可見其實力雄厚。

中環中心車位連錄承接

資深投資者「磁帶大王」陳秉志減價逾20%推售中環中心車位，市場立即有反應，車位連錄成交，其中B2層2個相連車位，以每個468萬成交，新買家協成行家族成員；還有，B1層雙號車位亦以550萬成交，買家為九記牛腩負責人相關人士，九記牛腩為食肆名店，多年來均獲米芝蓮星級推介，座上客包括名人及明星。

業內人士指，上述買家可能是區內用家，協成行大本營設於中環，九記牛腩亦位於區內歌賦街，事實上，中環區內車位供應罕有，過往旺市時「一位難求」，實力買家把握淡市時入市。

巨舖呎價造價皆高企

中環德輔道中84至86號章記大廈地下及地庫以3.7億易手，呎價高達5萬，新買家為恒生銀行創辦人之一利國偉家族及有關人士，據了解，新買家看中該巨舖中環罕有，面積大，銀行、零售及食肆皆適宜。該巨舖地下面積約3163方呎，地庫面積約4200方呎，合共7363方呎，平均呎價約5萬。利國偉家族亦於2020年4月，以2.86億買入中環永安集團大廈全層，平均呎價2.58萬。

(星島日報)

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Tesla趁租平 轉戰荃灣甲廈環貿廣場

包括寫字樓及舖位 月租共45萬元

甲廈空置率高，租客選擇多，全新甲廈及超甲廈吸引租戶搬遷。消息指，荃灣新甲廈環貿廣場寫字樓及舖位，獲電動車品牌Tesla租用作搬遷。另外，中環國際金融中心一期及國際金融中心二期，相繼錄歐美金融機構承租作升級。

市場人士透露，荃灣沙咀道1號環貿廣場低層3至7室，面積合共約5,740平方呎，以每呎約18元租出，每月租金約10萬元，新租客為電動車龍頭品牌Tesla，該品牌目前租用九龍灣國際展貿中心地下及樓下辦公室，由於大業主將為物業拆卸重建，商戶需尋找新辦公室，相信Tesla看好荃灣區租金較便宜，而物業屬全新，故決定租用。

8地舖料作陳列室 呎租近50元

據了解，是次Tesla除了租用辦公室外，亦租用物業地下8個舖位，面積合共約7,045平方呎，月租約35萬元，呎租近50元，料作品牌陳列室之用。

環貿廣場為甲廈重建項目，由億京發展，項目去年落成，資料顯示，環貿廣場錄得約10宗買賣成交，平均呎價約1萬元，涉及以中、小型單位為主，面積介乎約543至2,125平方呎，售價由535至2,141萬元不等，每平方呎造價介乎9,108至10,735元。由於銷情仍較慢，發展商把部分單位轉作收租，並成功吸引大型汽車品牌租用。

另外，消息指中環國際金融中心二期低層13至15室，面積約4,632平方呎，以約55.6萬元租出，呎租約120元。據悉，新租客為英資金融機構，原租用同區萬宜大廈4,000呎單位，是次租用國際金融中心二期，面積相若，主要可作物業升級。

愛彼錶租 The Henderson 全層

其次，同區國際金融中心一期38樓全層，面積約16,247平方呎，成交呎租約120元，涉及每月租金約195萬元。新租客為美資金融機構，原租用同區盈置大廈兩層樓面，如今租用國際金融中心全層，既可整合業務，同時提升辦公室質素。

該層樓面原由瑞士老牌私人銀行寶盛集團租用，集團原本租用中環國際金融中心一期3層樓面。2021年該集團決定預租鰂魚涌太古坊二座4層樓面作搬遷，可節省租金支出，本年中，其中一層樓面獲中資科企巨頭字節跳動租用作擴充，現另一層則獲美資金融機構承租，反映超甲廈仍屬國際企業首選。

事實上，近期中環超甲廈租務稍加快，如恒地 (00012) 旗下 The Henderson 明年初落成，近日亦獲瑞士製錶品牌愛彼錶 (Audemars Piguet) 租用全層約1.2萬平方呎樓面，作為其AP House及香港辦公室之用，市場估計呎租約120元。

(經濟日報)

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