Table of Contents
Phase 2 of the new project Pavilia Tower in Tai Wai recently recorded its first second-hand transaction. Room D on the middle floor of Block 6A (451 square feet, two bedrooms) was sold for HK$9.2 million after negotiation, which is a book loss of HK$750,000 compared to the owner's first purchase price of HK$9.95 million in 2020. If expenses such as stamp duty and commission are taken into account, the actual loss is over one million, making it the most watched case of asset shrinkage since the housing estate was occupied.
Transaction Analysis
The unit was originally priced at 9.5 million, but after a tug-of-war between the buyer and the seller, the price was reduced to 3.2% touchdowns. Calculated based on the practical price per square foot of HK$20,399, it is down HK$8.4% from the transaction price of HK$22,262 per square foot of Room D on the same high floor two years ago, highlighting the pressure of adjustment in the property market. The branch manager of Centaline Property Agency revealed that the buyers were a young couple who valued the transportation advantages of the property above the MTR, as well as the developer’s signature quality assurance, and decided to take over after a comprehensive inspection of the building.
Supporting advantages
With the geographical advantage of "three lines converging" (East Rail Line/Tuen Ma Line/Shing Mun Tunnel), Parkview Hill is only a 5-minute walk to Tai Wai Station. It has a 20,000-square-foot shopping mall at the base, which is connected to the Sun Chui Village Market and large supermarket in the area, providing complete living functions. The project's clubhouse "CLUB PAVILIA" is equipped with 28 facilities including a 50-meter starry sky swimming pool and a banquet hall, which is top-notch in the area.
Market Insights
Second-hand transaction volume in New Territories East this month fell by 15% compared with the same period last month, with the average price per square foot reported at HK$15,800. There are about 50 second-hand listings in Parkview Hill, with the asking price for two-bedroom units generally ranging from HK$9 million to HK$10.5 million. The transaction price is close to the landmark housing estate, Jubilee Garden (average price per square foot: HK$18,500), reflecting that buyers are becoming more cautious in their bidding.
Case Study
The depreciation of Parkview Hill reflects the liquidity risk of "expensive new homes". Investors who bought them at a premium of about 25% are now facing challenges. With interest rates high and new properties being sold at market prices, it is expected that the secondary market will continue to be under pressure in 2024. It is recommended that owners expand their room for negotiation to promote transactions.
It is worth noting that the original owner chose the developer’s high-ratio mortgage plan that year and faced double financial pressure during the interest rate hike cycle. Market sources indicated that there were still several urgent sales listings in the estate, among which the asking price for a low-floor unit in Block 7B had been adjusted to HK$8.8 million, with a potential loss of more than one million compared to the purchase price, indicating that the "bottom-breaking trend" of new housing estates may spread.
