Sun Hung Kai Properties Ltd (新鴻基地產), Hong Kong’s biggest developer, is offering new homes at a discount to entice buyers amid a worsening political crisis.
The first batch of units in the Kowloon development Cullinan West III have been priced at 20 percent lower than current market levels in the area.
The pricing is described by the developer as “traveling back in time” — it is close to the price set two years ago for the first phase of the same development, even though home values have risen 8 percent in the period.
“Recent social events and the US-China trade war have heightened some buyers’ wait-and-see attitude,” Sun Hung Kai Properties deputy managing director Victor Lui (雷霆) said.
Housing demand remains strong, as reflected by the good reception for other new projects, Lui said.
Months-long anti-government protests have put more property buyers on the sidelines and sales have been hit across the board.
The transaction value for new luxury homes slumped 31 percent in July to an eight-month low, Centaline Property Agency Ltd (中原地產) data showed.
Monthly rents for ultra-luxury residences have fallen by about the same amount, the South China Morning Post reported on Tuesday, citing Landscope Christie’s International Real Estate.
What began as protests against now-withdrawn legislation that would have allowed extraditions to the mainland have grown into demonstrations for wider democracy.
With Hong Kong Chief Executive Carrie Lam (林鄭月娥) refusing to satisfy protesters’ demands other than officially killing the controversial bill, the unrest looks set to linger.
SLUMP IN TOURISM
The protests in Hong Kong, now in their 15th week, continue to impact the territory’s tourism industry and in particular visitors from the mainland, who are usually its biggest group of tourists.
The number of Chinese group tours to the territory in the first 10 days of this month fell 90 percent compared with the previous year, Travel Industry Council of Hong Kong data showed.
Last month, the decline was 63 percent compared with the previous year.
Hong Kong’s hotel industry is struggling with a collapse in bookings after protesters disrupted flights from the territory’s airport last month.
Hong Kong’s economy contracted 0.4 percent in the second quarter from the previous period, raising the prospect of a technical recession.