News Hong Kong Property & Finance

Sell property now?

ORIGINAL POST
Posted by kissy.missy 13 yrs ago
we have a 428 sq foot flat in kennedy town and i was planning to sell it to get some profit but people are telling me to wait till the MTR is up and running.


the building is 22 years old and with the recent repair works, i'm not feeling "it" anymore. plan is to sell it and we rent somewhere till we buy again.


would you wait for the MTR to open in kennedy town or sell it now?

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COMMENTS
Loyd Grossman is Miss Venezuela 13 yrs ago
If you can afford it, I would wait. Why sell when people keep talking down the market? What if you and rent (thereby losing 100% of your rent money) and flat prices and rents don't go down or slowly rise? You're finished. There are very few cheap flats available at the moment and I don't think that will change with inflation at about 6%. Buying a flat is not just about making a quick buck - there will be optimistic and pessimistic periods - and HK people are often driven by sentiment. The MTR should make a big difference and it'll be completed in about 2 years.

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punter 13 yrs ago
If you sell now, you'll realize your paper gains. You'll be able to hold it in your hands, so to speak.


If prices and rents keep on going up, it will look as if you've lost what you gained and you will suffer the fate of forever-renters (like dealing with landlords, moving every now and then, etc.)



If prices have peaked and start to go down from hereon, you will have made the best decision in your life and may be able to buy the bigger flat you desire at a lower cost.


It's for you to decide and enjoy or suffer the consequences of your property call.

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kissy.missy 13 yrs ago
well i do think that the price is not going to go any higher for a 428 sq ft/22 years old flat. the neighbour's flat with same size (not renovated) was recently sold for $2.91M. i bought mine nearly 3 years ago for $1.58M.


if i sit and wait for the MTR to open and expect my flat to sell for $3.5M or more then maybe i'm "just" dreaming? i agree that no one can tell what the property prices will be like once the MTR opens but for a small sized flat in an ageing building, i don't think there'll be a HUGE price rise in 2 years time.


if i owned it in mertons then i would hold on to it for sure :)

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punter 13 yrs ago
The current prices may already have factored in the MTR factor.

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kissy.missy 13 yrs ago
yep - i think the same, puntaahh!


i'll put it up for sale and see how it goes. thanks for your valuable comments - helped this freshie a lot!

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kissy.missy 13 yrs ago
right then - another question for you since you're so bored!! (i mean "helpful"):


have you ever successfully bought as soon as you have sold, like no over-lapping of signing the sell and purchase agreements in order to avoid losing the deposit?

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elsdon 13 yrs ago
Just as a note.. when MTR stations get announcement there is a noticeable price hike in real estate around the area (obvious.)


Less known, there is a secondary price increase once the MTR station actually opens as well.


My personal take is to sell now and cash in if you can. Given the extremely low transaction rates right now it could prove to be quite difficult unless you are willing to cut your asking price.

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kissy.missy 13 yrs ago
then again i'll be bound to rent for one year after selling this flat (sigh) and i do not fancy paying an arm and a leg for these short term services apartments.


ok i know what to do now - sell first, rent for a year (sigh) then buy! don't want to go bald by the end of next year!! :p

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kissy.missy 13 yrs ago
oh god - not maths AGAIN! ><

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Loyd Grossman is Miss Venezuela 13 yrs ago
I think your chances of buying a similar place cheap a year later - and in the same area - are in the 'snowball in hell' category'. If this is your only flat and you intend to live here long term then you could very easily find yourself losing all your profit on rent and living up in a smaller flat in Tung Chung. I have a similar flat opposite the Sai Ying Pun MTR. I'll only consider selling it at 20,000 psf because that's what the land is worth (valued at about 7,000 psf). Of course, no takers at the moment but the rent is 20% more than the mortgage and my kids could use it when they grow up. I really think most HK homeowners are in a similar position so your chances of finding another place anywhere near valuation are very, very slim. However, someone else may also panic.

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kissy.missy 13 yrs ago
if i stay put in this current flat and leave HK in 5-10 years (building will be 27-33 years old), wont the old age of the building makes it less worth than it is now?

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elsdon 13 yrs ago
lol@the rent arguments..


Look your profit right now based on what you bought/can sell for is approximately 1.3M HKD right?


Renting a similar place would be what like.. 8k-9k HKD a month? (Assuming 3% yield on 2.91M) Meaning you could rent for 10+ years before you would start running a 'loss'.


If you factor in mortgage payments as 'savings' it makes the argument a bit more complex, but if you put the 1.3M in a humble investment vehicle you could effectively get yield on your cash as well..

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kissy.missy 13 yrs ago
yes, my intention was to sell this one for 'that' profit and buy a bigger flat away from hk island (too expensive!). i'd have to commit to 1 year rent if i cant get the selling agreement and purchasing agreement to complete simultaneously.


in 1 year's time, the flat i'm looking to buy might be out of my reach...hate uncertainty! :(

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Loyd Grossman is Miss Venezuela 13 yrs ago
If you sell now, you'll get HK$/dollars and the Fed is about to embark on another round of dollar printing. This will eventually push up rents and house prices. Kissy.missy. If you get this wrong, you are toast. You may never get another chance to get back in. I wouldn't over worry about the age of the flat, it's the location (mainly convenience and schools) which is important in HK.

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kissy.missy 13 yrs ago
good points - thanks!


ok..i'll sell it when i move back to england in 5-10 years time..don't want to age faster with these worries!

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muse07 13 yrs ago
It depends a lot on the exact flat. I've been closely monitoring prices in Kennedy Town/Sai Ying Pun recently and I think that prices will in general continue to rise, albeit perhaps more slowly.


How does the building compare to Smithfield Terrace in KT? It seems to have been steadyish sales lately. It's a 25 yr old building and flats of only 370 sq ft have been fetching HK$3m and above recently, although I understand they may have good views.

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If you really want to move, you cld always rent it out?

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muse07 13 yrs ago
Exactly. It's certainly not selective and is updated every weekday with sales registered. There's no suggestion that it doesn't record price decreases, which of course it has. It's a handy way to drill down in looking at recent sales in different areas and buildings.


Walkup, yup, could well be happening.. I had a look at several Urbana apartments a few months ago and although they are fitted out very nicely and modern - and seem to have been generating very good rental yields - I'd much rather renovate an older and much bigger apartment that I can actually live in

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OffThePeak 13 yrs ago
Posted by kissy.missy (8 days ago)

"then again i'll be bound to rent for one year after selling this flat (sigh) and i do not fancy paying an arm and a leg for these short term services apartments.

ok i know what to do now - sell first, rent for a year (sigh) then buy! don't want to go bald by the end of next year!! :p"


Hmm.

There's an easy solution:

Sell to an investor, and rent it back for 12-18 months. Then you can stay put.


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Loyd Grossman is Miss Venezuela 13 yrs ago
OffThePeak. What investor would that be? All out of the market now.

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OffThePeak 13 yrs ago
There are investors out there, and if the can have a leaseback for the 18 month period, then then may be happier to buy, looking at the yield.

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OffThePeak 13 yrs ago
A decent lawyer should be able to handle the technicalities

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