Distressed sales in Hong Kong’s luxury property market have driven prices down by as much as 50 per cent, with opportunistic buyers snapping up bargains, a property consultancy said

Transactions in Hong Kong’s super luxury property sector have been supported by opportunistic, cash-rich buyers pouncing on distressed sales amid a downtrend in sentiment, according to an property consultancy’s report on Friday.

Most of these distressed sales have been witnessed in the prestigious area of The Peak at prices averaging 50 per cent below their Covid-era valuations, the property consultancy said

“This sharp decline in prices has been largely attributed to several instances of distressed sales, where property owners were compelled to sell to settle outstanding debts,” the report said.

In July, the consultancy brokered the sale of four mansions at 46 Plantation Road, which were sold for HK$1.1 billion (US$141 million). The houses were among several assets the family of Ho Shung-pun, a low-key clan of real estate developers in Hong Kong, had pledged as collateral for HK$1.6 billion of private credit loans.

The consultancy also brokered the sale of a house that once belonged to China Evergrande Group chairman Hui Ka-yan. The ultra-luxury property on The Peak sold for HK$838 million.

“As veteran investors and property owners began to face financial difficulties, these resulted in sharp price cuts for the emergency sale of such properties,” an agent said.

The agent said overall property prices in Hong Kong have adjusted since last year, and continue to trend downwards this year, despite the government’s withdrawal of all property cooling measures in late February. The downturn has affected commercial properties as well, which have experienced a huge drop in rents and selling prices.

Hong Kong’s lived-in home prices fell 1.9 per cent in July from the previous month, dragging the official benchmark to its lowest level in nearly eight years, according to data from the Rating and Valuation Department.

The agent said that about 10 years ago, banks readily approved loans for investors to buy properties during the low-interest rate environment.

The agent said investors had not faced serious difficulties from the rising interest rates until the end of last year, which pushed Hibor, or Hong Kong interbank offered rate, above 5 per cent, pressuring mortgage repayments. At the same time, rents of commercial buildings and retail shops also fell, the agent added.

“As a result of these two factors, [property owners’] cash flow has been hit, affecting valuations,” the agent said. “Banks started to call loans from individual investors, which forced property owners to sell their assets at significantly reduced prices.”

The agent has been involved in many of Hong Kong’s significant transactions this year.

“We’ve been targeting some of the distressed companies and individuals as early as 2022,” another agent said. “The Peak currently has over 100 houses, which have been put up on the market for sale, both primary and secondary, and the number of sellers with financial urgency has risen to double digits.”

Some cash-rich buyers are eagerly monitoring the prices, which have come down at least 30 per cent from their highs, the agent added.

Looking ahead, the agent said the property market may stabilise towards the end of following the Federal Reserve’s interest rate cuts. Fed chair Jerome Powell gave the clearest indication of a rate cut as soon as this month in a recent speech at the bank’s Jackson Hole meeting.

The market may steady only a bit as the impact of the rate cuts may not materialise immediately, the agent said.

The agent added that the downturn in the property market this time has been no worse than the Asian financial crisis 27 years ago.

“Even the rich owners may have faced difficulties this time, but the depth and breadth of the property market adjustment is comparable to that in 1997,” the agent said.

The agent predicted that as there are still many owners selling their properties at significantly reduced levels, the prices of the properties will continue to trend down.

“The adjustment in the property prices has not yet ended.”

(South China Morning Post)

外資代理行：甲廈價格料續回落 下半年跌幅度5%至10%

投資市場面對挑戰，高昂的融資成本，逼使貴重物業組合持有人以折扣價出售非核心資產，有外資代理行預計今年下半年甲廈價格跌5至10%。

該行代理表示，持續高昂資金成本推動投資者以折扣價賣資產，銀行不願向商業物業提供貸款，限制投資需求，現金充裕的買家成為贏家。

投資者吼回報5至6厘物業

該行另一代理指， 香港房產市場面臨重大挑戰，港元升值和高息影響本地經濟，導致遊客消費下降。深圳新購物商場吸引港人到內地消費，導致核心街舖租自2019年起跌50%。

現金充裕的私人投資者和機構瞄準回報達5至6厘物業，惟高回報通常為新界區物業，2024年下半年可能有更多高回報放盤出現。

大手買賣金額按年跌47%

就非住宅大手買賣，2024年上半年僅錄99億，較2023年上半年下降47%，惟今年第二季度仍有一宗全幢出售交易，香港都會大學斥資10億購入紅磡成木酒店。商廈則以折扣價出售，由高盛及凱龍瑞以16億收購和發展的全新寫字樓88WL，僅以7億售予本地投資者，賣方遭受重大虧損。美國銀行中心兩個樓層造價較高峰時跌近60% ，皇后大道中9號29樓單位成交價亦較高位下挫60%。

(星島日報)

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觀塘偉業街全幢商廈延遲拍賣

由私募基金持有的觀塘偉業街全幢商廈東九匯，原訂於本周三拍賣，現時決定延遲，尚未落實時間。

暫未定日期及開價

私募基金基滙資本及數位共同投資者就觀塘偉業街133號全幢商廈東九匯，原本委託一間外資代理行於9月4日 (星期三) 公開拍賣，該行發言人昨日表示，拍賣將延遲舉行，日期稍後公布，項目暫未定拍賣開價。

該全幢總建築面積約192857方呎，每層面積14710方呎，提供區內同類型商廈少有大樓面設計，目前出租率約76%，平均呎租約30元。該廈於1969年落成，樓高13層連天台。

東九匯前身為長輝工業大廈，基滙資本2013年以9.3億向「舖王」鄧成波購入，斥2.7億作翻新及作活化商業用途，2015年入伙，並於2017年7月將項目50%業權，售予SILKROAD基金及其他投資者，作價約10億。

(星島日報)

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