City of Lifts? (Photo: hongkong)
Sales of Hong Kong's new homes could reach record highs -- yes, another record high -- over the next couple of years as developers accelerate releases of residential projects, according to a report in the South China Morning Post.
"We see the property up-cycle continuing until the end of 2014 at least," Lee Wee Liat, head of research at BNP Paribas Securities, said to the Post.
"Primary-market transaction volumes should remain strong over the next two years, possibly hitting historical highs of 15,000 units and HK$150 billion in each of 2013 and 2014."
Lee expects the number of deals in the primary market to reach 13,000 this year with a total value of HK$136 billion, compared to 10,501 deals last year at a total value of HK$133.32 billion.
He predicted that home prices would grow another 10 to 15 percent by the time 2014 rolls around.
"Developers with the most projects available for sale can capitalise on high property prices will outperform," he said.
Agents identified Cheung Kong as a likely outperformer, noting that it had more than 5,300 apartments available for sale until next year.
Its major projects include City Point, at West Rail's Tsuen Wan West station, and Lohas phase three in Tseung Kwan O. It was expected to achieve sales revenue of about HK$50 billion if all units were sold, agents said.
Cusson Leung, an analyst at Swiss-based investment bank Credit Suisse, said developers would now focus on the primary market.
"They are becoming more flexible on pricing and focusing more on asset turnover, and buying power will be absorbed by all the attention on primary projects," he said.
Sun Hung Kai Properties co-chairman Thomas Kwok Ping-kwong said last week the group would not hoard its supply of new flats.
"We will put the new projects up for sale once we secure pre-sale consent from the government," he said after the company's final result announcement last week.
Victor Lui Ting, deputy managing director, said SHKP planned to release HK$35 billion worth of units for pre-sale for the year ended June next year.
Henderson Land and New World are also likely to release more projects from now to next year, compared with their launch programme this year.
Lee said the key focus would be on their two joint-venture projects, the 928-unit Double Cove phase one at Ma On Shan and the 2,580-unit The Reach at Tai Tong Road in Yuen Long. More than 400 units at Double Cove phase one have been sold this month. Henderson Land Development also would start to see returns from its redevelopment projects, with five potential launches this year and six next year, Lee said.