〈Asian Post, September 9, 2017〉Stocks in Hong Kong ended the week on an upbeat note, paring the weekly loss to 1 per cent, helped by a broad advance in property developers as investors expected the government to launch a new affordable housing scheme to benefit young, first-time home buyers.
In the mainland, Shanghai shares closed flat, with the airline sector outperforming on the back of strong gains in the yuan.
The Hang Seng Index closed on 27,668.47 points, up 0.5 per cent, or 145.55 points. For the week, the index still dropped 1 per cent, snapping a three-week winning streak.
Worries about geopolitical tensions prompted investors to largely hold off buying this week, after North Korea conducted its strongest nuclear test explosion.
"Investors are still watching North Korea developments with caution," said Kenny Tang Sing Hing, vice-chairman and executive director of Jun Yang Securities.
Questions remain over whether it will launch a missile today to mark its national holiday, given it conducted a detonation last year.Investors are still watching North Korea developments with cautionKenny Tang Sing Hing, vice-chairman and executive director of Jun Yang Securities"Risks have increased in the Hong Kong market," said Linus Yip, chief strategist for First Shanghai Securities.
"Hong Kong stocks have accumulated considerable gains in the past few months. I believe a lot of investors are waiting for the right opportunity to take profit from previous orders."
〈Asian Post, September 8, 2017〉Chief Executive Carrie Lam Cheng Yuet-ngor's Policy Address to be delivered in mid-October will give details of the scheme for local first-time homebuyers. Families eagerly waiting to buy their homes are most concerned about the criteria, price and terms, while others are more interested in how this scheme is going to affect the property market.
Private property prices are so high today that many youngsters cannot buy a flat without financial assistance from parents. Some simply cannot afford a flat. HOS flats, however, are very expensive even though they are sold at discounted market price. They are also seriously in short supply. The strongest feature of the scheme is a pricing mechanism independent of market price. Citizens expect the price per square foot floor area to be lower than that of HOS flats. Hence they become "bargain units" that everyone is waiting for.
The scheme's name suggests that those who have bought an HOS flat or already own a property are not eligible, which is in line with the criteria for the HOS. But the income ceiling is not yet known. Lam yesterday mentioned that the target group includes young families with "decent incomes" but cannot afford buying a flat. So the income restriction is expected to be more lenient. It is not known whether there will be any age restrictions, while the meaning of "young" needs to be clarified.
Lam pointed out that the size, design and decoration of the flats will be a bit simple. The government's plan is to meet home ownership requirements of young families who can later "change to bigger units" to improve their living with better income. Hence the scheme plays the role of "interim housing" and may be cheaper than the HOS.
The government has not yet announced the pricing mechanism, which may take construction costs or citizens' affordability into consideration, but people expect the income restriction will be less harsh than the HOS while prices lower. Lam stated that with lower prices come more restrictions. The scheme has objectives similar to the HOS: to help citizens with home ownership. To prevent speculation, the HOS requires that in the first five years, buyers can only sell their units back to the Housing Authority at original prices. The scheme's sale restriction period should be even longer.
As the flats are in limited supply, the scheme will, like the Hong Kong Property for Hong Kong People project, not cool down the market very much. The Fed's monetary policy tightening through "balance sheet shrinking" and changes in interest rates, however, will have stronger effect.
〈Shanghai Daily, September 7, 2017〉A no-frills government-subsidised property scheme for young, first-time home buyers in Hong Kong might offer prices lower than half the market rate, a member of the Housing Authority said yesterday.
Stanley Wong Yuen-fai said on radio that Hongkongers widely expected a scheme that would provide subsidised housing based on affordability rather than market prices. "If [the prices] are set based on affordability, we believe they will be roughly half the market rate ... or lower," he said.
The "Starter Homes" scheme was an election pledge by Chief Executive Carrie Lam Cheng Yuet-ngor to help young families who could not afford private housing but earned too much to rent public flats. Prices for private residential property have surged for 13 months, making the city - already the world's priciest home market - even less affordable.
Wong said the scheme, expected to be highlighted in Lam's policy address in October, had not been discussed within the authority, which builds and manages public housing estates. But he was confident the body would have enough public housing expertise to handle the project.
Those who had previously bought a government-subsidised flat or owned any other property would not be eligible for the scheme, Lam said earlier.
Wong said there could be limitations imposed on resale of the flats. For example, they might only be sold back to the government at their original price.
Wong, who is also chairman of a government task force on land supply, added that the panel would first discuss a dozen proposals from by various groups before making them available for public consultation in the first and second quarters next year.
〈The Standard, September 7, 2017〉Wheelock Properties (0200) priced its Oasis Kai Tak project at about HK$20,000 per saleable square foot - the most expensive in the district over the past 12 months.
The first batch launched comprised 130 units, the smallest being a 275 sq ft studio flat priced at about HK$5.2 million. Back in 2014, Wheelock won the Kai Tak site, which has maximum gross floor area of 413,000 sq ft, by shelling out HK$2.5 billion.
Located at 10 Muk Ning Street, the per square foot price of Oasis is about 7 percent higher than the first batch flats launched at the "Hong Kong Property for Hong Kong People" project - One Kai Tak phase two.
Over the past year, about 3,000 new residential units in Kai Tak East have been sold, with the One Kai Tak project, developed by China Overseas Land (0688), accounting for about 1,000 flats.
The average per sq ft price of One Kai Tak is about HK$18,500, while Victoria Skye is about HK$19,500 and K. City about HK$19,700.
In Tuen Mun, Couture Home Properties, a unit of CSI Properties (0497), said yesterday its featured homes at COO Residence will be priced under HK$18,000 per sq ft.
This nano flat project will provide 204 units, ranging in size from 217 sq ft studios, to 374 sq ft two bedrooms in one tower.
Meanwhile, a case of deposit forfeiture was reported at Larvotto in Ap Lei Chau. It involved a 1,795 sq ft flat which was priced at about HK$41 million, or HK$23,243 psf.
This was the fourth case of deposit forfeiture recorded at Larvotto so far in the past two months. In the secondary market, a 1,507 sq ft flat at Cavendish Heights in Jardine's Lookout was sold for HK$42.8 million, or HK$28,401 psf, according to Ricacorp Properties. The vendor purchased the home in 1998 for HK$13 million.
In Southern District, a 3,680 sq ft house at Bay Villas, on Shouson Hill Road, changed hands for about HK$400 million, or 108,696 psf. The owner doubled his money, after acquiring the property for HK$200 million in 2010.
〈The Standard, September 6, 2017〉Flats for the planned Starter Homes scheme should cost about half of the market price, the chairman of the new Task Force on Land Supply, Stanley Wong Yuen-fai, said yesterday.
Chief Executive Carrie Lam Cheng Yuet-ngor announced on Wednesday that her maiden policy address on October 11 will include the scheme that would help young families get on the property ladder. The task force had its first meeting the same afternoon.
This comes as a new Citizen Task Force on Land Resources was set up yesterday as a counterpoint to the government-appointed task force.
Speaking on an RTHK program yesterday, Wong, who is also Housing Authority subsidized housing committee chairman, estimated that flats provided under the Starter Homes scheme would cost less than Home Ownership Scheme flats.
"It would be cheaper than the current HOS flats if the price is set according to applicants' affordability,'' Wong said. "Roughly estimating, it should be about half the private market price.''HOS flats are priced at 70 percent of the market price.
Wong said there must be restrictions on the resale of Starter Homes, like forbidding buyers to sell the flat to anyone except the government.
"If the two types of subsidized housing have different price tags but same restrictions, this would impact on one of the housing schemes,'' Wong said. "People may either sell their flats at the original price, or the government may calculate the price according to the affordability at that time.''
Secretary for Transport and Housing Frank Chan Fan said asset appreciation is not the focus of the Starter Homes policy, so there will be harsh restrictions in resale. "We hope to utilize Hong Kong land to provide Hongkongers with houses, so it's clear that we prioritize allowing youngsters to buy their first flats rather than asset appreciation,'' Chan said.