Mid-Levels West assets changed hands recently at a big discount, a sign
that deep-pocketed investors or homebuyers are coming back to the
has improved amid speculation on more market-friendly measures, and
popular view that global rate-hike cycle has peaked
Kong’s deep-pocketed investors and homebuyers have been snapping up
foreclosed luxury homes at great bargains in recent transactions,
suggesting an increase in appetite as the global interest-rate hike
cycle comes to an end.
1,301-square foot unit at Azura on 2A Seymour Road changed hands at
HK$37 million (US$4.73 million) last week, according to people familiar
with the matter. The property was valued at HK$45 million. A
three-bedrooms unit at Alassio on 100 Caine Road was sold for HK$34.8
million, or about 20 per cent below its asking price.
Both properties are located at Mid-Levels West and developed by Swire Properties.
properties, those seized by banks due to missed mortgage repayments,
have added to active transactions of luxury homes in recent months, an
auctioneer said. A multi-year stock market slump and higher interest
rates are the likely source of financial distress.
“Veteran investors in the
property market are quick to act, and those who are cash-rich will come
out to buy now, but the bargains have to be big,” the auctioneer said.
“There are more enquiries for these properties after the recent easing
measures and the view that the rate-hike cycle has peaked.”
The Hong Kong Monetary
Authority has lifted its base rate by 525 basis points in total since
March 2022 in lockstep with the hikes by the Federal Reserve, while the
city’s commercial banks raised their prime rate five times by a total of
87.5 basis points. An unprecedented slide in the Hang Seng Index has
erased about US$2 trillion of equity wealth since early 2021.
Still, there has been a
turnaround in sentiment. The stock market has rebounded this month, and
there is hope that Financial Secretary Paul Chan Mo-po will deliver more
surprises during the budget on February 28, including undoing the curbs
to combat excessive speculation introduced in the early 2000s, to
follow up on the incentives in last year’s policy address.
another recent transaction, a 420-sq ft unit at The Arch in Tsim Sha
Tsui was sold at HK$11.25 million last week, or 25 per cent below the
asking price. The property, owned by former chairman of Goldin Financial
Holdings Pan Sutong, was seized by lenders last year, according to a
local media report.
sell foreclosed properties according to valuations pegged to recent
secondary-market home transactions, another auctioneer said. That market
has been lukewarm as transaction volume and prices have weakened.
transactions shrank last year to the lowest level in decades. Sales
totalled 29,690 units worth a combined HK$251.2 billion last year,
according to a local property agency. The number of deals fell by 6.6
per cent to a 28-year low, while value shrank by 11 per cent to a
banks sell seized properties at a much lower price, they will not incur
losses, according to the auctioneer. At best, they will recoup their
loans and gain a small profit,”. Current low unemployment rate also
indicates that homebuyers generally can still afford to repay their
end-users are looking for foreclosed mass residential properties, as
valuations of these properties have been discounted by almost 30 per
cent during the past three months,” the auctioneer said. “[Properties]
from some popular housing estates can be sold quickly as the supply is
(South China Morning Post)