Thursday, March 18, 2010

HK luxury house fetches near-record price

HK$280m paid for Peak property on Severn Road

A Hong Kong listed company said yesterday it will buy a luxury house for a near-record price in the city, a month after the government introduced measures to cool the city’s property market.

Sino-tech International Holdings, an electronics components maker, said it has agreed to buy the 4,650 square foot property on the Peak for HK$280 million (S$50.42 million), or HK60,215 per square foot, as an investment.

The per-square-foot price is among the highest paid for a property in the southern Chinese city, after a duplex was sold by Henderson Land Development in October for an Asian record of HK$71,280 per square foot.

The Peak property is one of the 22 houses in the luxurious Severn 8 development on Severn Road, which was named by online analysis group The Wealth Bulletin as one of the 10 most expensive streets in the world last year.

Also on the list were Chemin de Saint-Hospice in the South of France, Fifth Avenue in New York, and Kensington Palace Gardens in London.

The near-record price was reached despite a series of measures the government introduced in February to cool the white-hot property market, such as increasing residential land supply and stamp duty for luxury flats.

John Tsang, the city’s financial secretary, said the government was worried that the property frenzy, supported by strong demand from rich mainland buyers and a big inflow of funds, would create a bubble and affect the stability of the financial system.

Prices of some luxury flats returned to the peaks of the 1997 property boom in January, Mr Tsang said.

Stimulus measures by governments around the world have boosted liquidity, which has lead to large fund inflows into Asia.

China has also seen soaring property prices, with values rising at their fastest pace in 17 months in December after Beijing encouraged tax breaks, loans and lower downpayment requirements to boost the sector during the slump.

Source: Business Times, 18 Mar 2010

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