Hutchison Whampoa Ltd. sold a second house in Hong Kong’s upmarket Victoria Peak area in a week for more than HK$500 million ($64 million), as developers accelerate sales amid expectations property prices are peaking.
The 5,706-square-foot (530-square-meter) house in the seven-home, 28 Barker Road project was sold to an unidentified buyer for HK$538 million ($69.4 million), according to the project’s website. Hutchison Whampoa, controlled by Li Ka-shing, Asia’s richest man, on Nov. 20 sold a house in the same project for HK$740 million, the highest paid in the city after a house on Pollock’s Path also in The Peak area sold for HK$800 million in 2011, according to broker Colliers International.
Hong Kong developers are putting more homes on the market as analysts at Barclays Plc and UBS AG forecast prices will fall at least 20 percent through next year because of government curbs and slowing household income growth. The city’s luxury residential properties will drop about 3 percent in the fourth quarter, extending a decline since the start of the year, as transactions decline to the lowest in almost two decades, according to broker Cushman & Wakefield Inc.
“There’re still plenty of demand for houses in that area,” said Thomas Lam, Hong Kong-based head of research at property broker Knight Frank LLP. “The general luxury market has slowed down a bit, but The Peak is a different story. There isn’t much new supply there and it is a truly exclusive area.”
Swire Properties Ltd., one of the city’s biggest prime-office landlords, is selling a 5,409-square-foot apartment at a Frank Gehry-designed building on a hillside in The Peak area through a tender, it said last week. The company set a reference price of HK$470 million for the unit.
The Peak is one of the city’s most-expensive residential areas where global banks and companies such as HSBC Holdings Plc house their top executives. Swire Properties last year sold a unit in Gehry’s Opus Hong Kong building for HK$455 million, a record for apartments in the city.
On an international scale, Zhang Xin, chief executive officer of Beijing-based developer Soho China Ltd., paid $26 million for a New York townhouse in October, the Wall Street Journal reported earlier this month. Meanwhile, U.K. billionaire property investors David and Simon Reuben won approval earlier this year to turn a former members-only club in London into a home that Savills Plc estimates could fetch 200 million pounds ($324 million), which would make it the country’s most expensive.
Hutchison Whampoa, Li’s biggest company, also invests in telecommunications, ports and retail in more than 50 countries in addition to developing properties in Hong Kong and mainland China. Most of Li’s property investments in the city are done through Cheung Kong Holdings Ltd.
Hong Kong’s government has since 2010 imposed various extra property transaction taxes and tightened mortgage lending to curb home prices that are now the world’s highest.
The government in February doubled the stamp duty on all property deals over HK$2 million to as high as 8.5 percent. In October 2012, it slapped a 15 percent extra tax on home purchases by all non-Hong Kong residents and corporate buyers.
Hong Kong home prices are the world’s highest in a Savills Plc survey of 10 cities, including London, New York and Tokyo. The value of luxury properties will drop as much as 5 percent in the second half after a 3.2 percent decline in the first three months of the year, according to Savills.