CONCERNS OVER HOME PRICES
This surprise announcement was met with a residents’ petition and threats of protests. Under the so-called “light public housing” scheme, monthly rent for units measuring 330 sq ft will cost, at most, HK$2,650 (US$338).
Flats of similar size at The Henley, a nearby luxury complex developed by Henderson Land Development, can go for HK$15,000.
There are even fancier buildings in the area. Pano Harbor, which promises panorama views of Victoria Harbour, recently sold a 2,088 sq ft unit for more than HK$95 million, according to the government’s land registry. The transaction value was most likely agreed on before the public housing announcement.
Aside from the nuisance of commuter crowds and traffic jams, Kai Tak residents worry their home prices will nosedive. Spooked developers might also rush to sell existing stocks and offer juicy discounts and rebates if necessary. More than 10,000 units from 17 new projects can come to flood the market this year, according to estimates from Bloomberg Intelligence.
After all, Hong Kong’s builders have already started resorting to price cuts to boost their sales. Earlier this month, CK Asset Holdings slashed its offerings by as much as 18 per cent at Seaside Sonata in Cheung Sha Wan. The developer is now Kai Tak’s largest landlord after winning a land bid in December for the lowest price since 2014.