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Hong Kong to Hold Land Auction for Kowloon Tong Private Residential Site
Hong Kong will next month sell a residential plot adjacent to one sold for a record price for the Kowloon Peninsula last month.
The auction for the site on Ede Road in the Kowloon Tong district was triggered by developers’ applications and the opening bid for the lot will be HK$1.05 billion ($135 million), the Lands Department said in a release posted on website today. The site has a maximum buildable area of 8,424 square meters (90,676 square feet), the statement said.
Prices have exceeded estimates in both land auctions held since Hong Kong stepped up efforts to cool the property market last month. Singapore joined Hong Kong in imposing anti- speculation measures this week, underscoring the risk of asset bubbles in Asia as record-low U.S. interest rates and the region’s economic recovery spur demand.
Kerry Properties Ltd., controlled by the family of Malaysian tycoon Robert Kuok, Aug. 31 paid HK$1.29 billion for a 77,469 square feet-adjacent site. The per-square-foot price of HK$16,587 is a record for the Kowloon Peninsula, according to real estate broker Midland Holdings Ltd.
The auction is scheduled to be held on Oct. 12 and will be the eighth one in the government’s current financial year.
Hong Kong’s home prices have surged about 45 percent since the beginning of 2009 on record low mortgage rates and the influx of wealthy mainland Chinese buyers, according to Centaline Property Agency Ltd. The government on Aug. 13 raised down-payment ratios and said it will increase land supply amid concerns housing is becoming unaffordable.
Most government land sales in recent years have been triggered by developers who promised to pay minimum amounts for sites on a list of available lots under the so-called land application system. Regular government land auctions have been partially resumed this year after they were halted in 2004 to support falling home prices.
To contact the reporter on this story: Kelvin Wong in Hong Kong at kwong40@bloomberg.net
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