Right time to buy property in Tung Chung ? Please advise



ORIGINAL POST
Posted by vivhunter 6 yrs ago
All,I need some advise from people on Tung chung property.I am hearing lot of news which are related to development in Tung chung few are below :1. HK -Macau bridge due to complete in couple of year now2. Govt plan to develop some areas to accommodate increased traffic expected due to new bridge3. New run way planned4. Visonary project got launched with successConsidering the above can you suggest if TC can have good price appreciation in coming years ? I am choosing TC because thats still a place where I can enter in property at decent price and could be affordable.thank you

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COMMENTS
OffThePeak 6 yrs ago
Sorry to say...
But you may have missed the Best Buying Window (2-3 months ago)

Sure, it's hard to buy when people are bearish, or bored.But that's when you get the bargains.Sellers are now lifting their asking prices, and are very unlikely to accept "lowball" bids.Nothing new in those Tung Chung points, and they may help relative price performance in the medium to long term.What I personally like about TC, is:

+ At about $6,000 psf, Gross (at Caribbean Coast, where I used to own several flats), TC is probably the cheapest decent "expat friendly" area in HK
+ A new MTR station is planned for Tung Chung East, and that may help prices, as completion grows nearer

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traineeinvestor 6 yrs ago
Having been out to Tung Chung/Caribbean Coast a few times, it appears to be a nice well planned and well managed estate at reasonable prices.However, if I worked in Central (or even TST) the commuting would be a killer for me. It takes close to an hour to get from Central to Caribbean Coast (with negligible waiting time at the station). The only person I know who is currently living there has found the commute has done serious damage to her social life as well as making a long working day feel much longer.Obviously, not everyone works in Central and the additional transport links will add to the appeal of the area, but there is also plenty of room for additional supply to be added as well (some is under construction now). As an investor rather than an owner occupier, buying in TC would be a punt on convergence with the pricing in other areas over a period of years as the transport links are completed.

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OffThePeak 6 yrs ago
I lived in Tung Chung for years, and owned several flats there. I don't own them any more - I sold "too soon" - but since I do not own them, I think I can report objectively, from knowledge.There has been much nonsense written about the place by people who never lived there, so I suggest you discount (somewhat) secondhand and third hand reports - But this comment is not targetting the one just above mine, by Trainee Investor. It IS a long commute as TI has written, and from CC might be one hour door to door to a meeting in Central. But there are ways to cut that down:
==
+ The MTR time from HK Station to Tung Chung station is about 30 minutes.
So if you work in IFC, and live in TC Crescent, you can probably do something like 45 minutes door-to-door on a good day. That's not too bad compared with the commutes than many people in cities like London and NYC have

+ The commuting time should be slightly less than that to the New TC East if/when it opens, which is why I have suggested it. Some of the older properties near it (CC-1) are pretty cheap, which is why I mentioned it as a possible place to bargain hunt. But you are going to have to put up with some years of bus rides until that new station is done. You might BUY as an investor, and rent out your flat until the new station is working.

+ If you are a single person, wanting to have a social life on HK Island, then anywhere far away, such as TC or LOHAS Park will cause some problems, just as living in Disco bay would. You will save plenty of money when you go to buy : The difference between CC's $6,000 psf, and Midlevels at $15,000-20,000 psf is big. But you lose time commuting, and have occasional large taxi bills to pay (probably.) TC living may make more sense for a couple, or for someone who is capable of building a social life closer to where they life. (Check out the churches, libraries, golf course, pools, and other social activities in TC before you move there, if this is a concern.)

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Remmy 6 yrs ago
If you are considering Tung Chung then seriously consider Park Island which is better on almost variable you could consider.

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OffThePeak 6 yrs ago
Remmy, have you lived in TC?I think you should be clear about your position

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Remmy 6 yrs ago
OTP, don't get me wrong. I am actually quite bullish in Tung Chung as an investment. I think its going to do well. But I think Park Island is better (both for living and for a HK property investment).TC property will keep being built. Park Island on the other hand is inherently limited in supply.Park Island has facilities that really are second to non in HK. The pools for example are outstanding. Here are some pics of the Park Island swimming pools http://parkislandhongkong.blogspot.com.au/2011/05/pool-facilities-on-park-island.htm although the pics don't really do the actual pool justice if you see them directly.In terms of access to the airport, its quicker from Park Island.Park Island is still selling below HKD $10,000 psf. I suspect places in TC have prices similar with nowhere near the quality, facilities or for that price, the ocean views.TI'c comments about travel to central are a valid consideration to take into account. From PI its 15 mins by taxi and 20 mins by ferry (faster even that Discovery Bay to Central). The HK to Macau bridge will benefit TC for sure, but there is huge upside for Park Island when this is done, especially if they open up Ma Wan to cars for residents. See this link here http://parkislandhongkong.blogspot.com.au/2014/05/an-update-on-private-car-access-for.htmlI also think there is merit in the view that TC you can still buy in at a decent price, but the same also applies to Park Island if not more so given the upside. Yes, the new MTR will of course also help prices on TC. There is also speculation of a Park Island MTR, and if so, this will have alot more upside on prices because it is not as priced in as the Tung Chung MTR.Remember, my aim here is to provide people practical advice on how they can likely make money living and investing in HK. I am not dissing TC at all OTP. Yes you did sell too early. It has 10 years of upside ahead. I think though Park Island has more.

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Remmy 6 yrs ago
One more thing. Park Island is getting a massive beach extention due to be completed next year. Bu the sounds of things it will widen the existing beach by up to 2/3rd, which is clearly also going to be a drawcard (and something that is not very well known so again not very much priced in).

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OffThePeak 6 yrs ago
Thanks for all that detail, Remmy. Very useful.I have just returned from Discover Bay. The friends that I was traveling with want to view Positano, so we went to see two of the show flats. Not cheap, at $27 Million or so (after discount) for 1,400 and 1,900 sf Net, but it shows well. And apparently has sold pretty well too.The agent had over 20 years experience, so I asked him about Neo Horizons. I came close to buying a 750sf 2BR flat on a high floor at maybe HK$4.5 million. That was about 2 years ago. He told me that today the same flat would be over $5 Million.If you are interested in why I liked Neo Horizons, I can tell you. (I think I posted the reasons two years ago here, but cannot find them.) . . .
BTW, Vivi,Why do you think a new runway might help TC? IS it because of more jobs at the airport?Is it the same with the BCF, for you?

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vivhunter 6 yrs ago
Really appreciate reply from both of you REMMY and OFFTHEPEAK.

If I am not wrong close to 80-90K ppl work in Tung Chung/Airport, with new runway opening up the place may be in more demand and yes it will add jobs which in turn should result in property demand.

One thing which I don't really agree is the straight comparison of Park Island vs Tung chung, TC is 40 to 45% cheaper than Park Island and if I have to go for Park island then why not venture to more similar areas..

Two points are important 1. with present prices one can still enter into TC property 2. Can use the property to stay with assured price appreciation (not sure its assured or not).

OFFTHEPEAK, you had several prop only in TC why you sold all ? considering your view about TC development is very bullish ( dont take me wrong I like your views a lot)

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Remmy 6 yrs ago
OPT and VIV I found the article with more detail on the beach extension for Ma Wanhttp://parkislandhongkong.blogspot.sg/2012/09/ma-wans-tung-wan-beach-to-be-extended.html

I think you are right, for a range of reasons that the entire Tung Chung and Airport area will become more popular, but also its all becoming more connected to China, Zhuhai and Macau over time. So with property, I always look for the long term factors that will create upside over and above average market rates. Again I think TC is fine, and has upside. PI is much better in terms of quality (both of the buildings and facilities) but from a financial perspective, to me the huge upside is the boost that will come in prices if or when private car access is allowed on Park Island. Its a bit like the boost that property gets when an MTR station is announced or a new escalator, like in the Western Mid Levels. And of course the biggest gain is made by people who have bought before this news is priced in. Some are speculating that Park Island propty prices could jump 50% on such a development. I'm not sure if its that much or not, but I do think it would be big. So then when comparing to TC as a property investment, ask yourself, what is the biggest potential upside driving factor there?

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Remmy 6 yrs ago
One other point, and I am sure all will agree, I find it nuts the crazy prices people are paying for off the plan stuff, which apart from being way more expensive than the secondary market, might well be of lower quality. These people are sadly suckers. I don;t mind so much seeing a rich mainlander who wants to launder money lose money on overseas property, but when its a hard working family, wanting to perhaps "invest for the future" and think they are buying something secure by investing in property (and then the only thing they can afford is an overprices micro apartment- those people I feel sorry for).

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OffThePeak 6 yrs ago
I sold "too soon", because I had planned to leave Hong Kong.
But that did not happen for various reasons. It is good that I held onto
my property in Olympic. Else I would have wasted plenty on renting.
It is hard for me to buy back in now, because I would be paying more
than what I sold for.
.
If I owned nothing, I might consider buying in TC (maybe CC-phase-1),
as a sort of bet on the positive impact of the BCF, and East TC MTR.
.
Saving on rent, protecting from rising rents, is still a valid reason to buy, I think.
And as my partner has discovered, it is not necessary to LIVE in the flat that you buy as a Hedge. The logic is: you can buy a flat and collect the rent, and use it to cover the rent you pay elsewhere. So long as the rent you receive rises as much as the rent you pay, it is an effective hedge. And if you buy well, and get a bigger gain (than by owning the flat you live in) - you are better off.

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Remmy 6 yrs ago
Property can be an excellent hedge for sure. Long term, property will rise with inflation - that is pretty much an economic certainty. If you live in it yourself, you take the entire issue of finding a tenant etc out of the equation - a big plus. But yes, even owning property and renting it out (ideally at a high yield) and then renting a place to live in (ideally at a low yield) also is a very viable option. There are many people who sold, and are significantly locked out now from getting back in (at least at current transaction costs, which might come down over time).

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OffThePeak 6 yrs ago
When she bought at under $3 million, two big factors drove my partner's decision.

+ The Yield, NET of Mgmt Fee, was expected to be about 4% (better than newer properties)

+ The Stamp Duty was only 1.25%

I stood aside, because it would have pushed up the Tax.

A third factor was: In a pinch, she thought she could live in the flat.
But that was not her intent.

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vivhunter 6 yrs ago
Thanks for the feedback, I would consider TC crescent in TC. Looking at the transaction from last few months prices in this building varies a lot, a self view of place with be better.



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OffThePeak 5 yrs ago
NOW may be your moment

SHKP is offering its new project at BELOW the secondary market

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OffThePeak 5 yrs ago
Want to buy in Tung Chung?
Now may be your moment

"Sun Hung Kai Properties will sell some of its new homes at prices below secondhand flats in the area"

A 412-sellable-sf One-BR unit costs $3.69 million

Or HK$8,903 pssf after all sweetners

By comparison: Apts for resale are offered at HK$8650 or $10,780 pssf (per Centatline)

I see different figures in the Centaline index for Caribbean Coast.
But the SHKP offering has pushed prices down there:

Latest Caribbean Coast : Gross : $6,160 / Net : $8,259 pssf

Historical :
"the first batch of units at The Visionary... were sold for HK$7,671 pssf last Nov.2013"

Week : CCLI : CMMI: RobinPl / IslHarb ParkAv /C'ribC : TaikSh.
==== . .
12/21: 132.69 133.76: 15,524 /11,155: 12,664 / 6,160 : 13,504 < Psf, Gross

11/30: 130.46 131.44: 15,447 /11,650: 12,430 / 6,275 : 12,678
10/26: 129.39 130.04: 15,510 /11,460: 12,308 / 6,356 : 12,668
09/28: 128.14 128.33: 15,414 /11,687: 11,807 / 6,346 : 12,705
. . .
06/29: 121.19 121.42: 14,044 /10,490: 11,560 / 6,081 : 12,134
. . .
03/30: 117.22 116.40: 13,695 /10,342: 11,405 / 5,695 : 11,392
. . .
Efficiency -NA- --NA -: 82.24% /74.89% 74.31%/ 74.58%: 87.32%
12/29: Prices / NetSF: 17,519 / 14,397: 16,586 / 7,734 : 12,524 < Pssf
12/29: 119.07 118.19: 14,407 / 10,783: 12,325 / 5,768 : 10,936 < Psf, Gross
11/24: 120.39 119.64: 13,672 / 10,499: 12,000 / 5,961 : 10,864
10/27: 119.50 118.67: 12,717 / 10,576: 11,958 / 5,768 : 10,869

Efficiency -NA- --NA- : 82.24% /74.89%: 74.31%/ 74.58%: 87.32%
12/30: Prices / NetSF :18,221 / 13,929 : 15,020 / 8,116 : 13,359 < Pssf
12/30: 115.78 114.25: 14,985 / 10,432 : 11,161 / 6,053 : 11,665 < Psf, Gross

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OffThePeak 5 yrs ago
Thanks for that Info.
Usually they release the AVERAGE price, rather than the cheapest one.
And that was the only price mentioned in the article I saw in The Standard.
Do you know what average prices are?

The interesting think is that the announcement of prices seems to have PUSHED DOWN prices
in Tung Chung, since the Index for Caribbean Coast fell from $6,356 to $6,160 per SF, Gross. (-3.1%)
That last price of $6,160-Gross is equivalent to $8,259 PSSF.

So there seems to have been a knock-on effect from the SHKP launch,
and that may have widened the opportunity now to more than a single flat.

Anyway, I will try to get hold of a price list, and may even visit the showflat.
Do you know where it is ??

(In edit, I found this):
http://www.gohome.com.hk/new-property/Century-Link/ad-10951/en/
"Century Link is developed by Sun Hung Kai in Tung Chung, provides 1407 units,
70% are 1-2 rooms, 30% are 3-rooms."

PDF File: http://s3pictures.gohome.com.hk/images/newdevelopment_photo/pricelist/1666.pdf
I finally opened it, and found prices like:
$4.658 Mn for a 412 sf Flat on the 30th/Fl. = $11,308 pssf.

WEBSITE : http://www.centurylink.com.hk/
Brochure:
Pt-1 : http://www.centurylink.com.hk/files/century_link_sales_brochure_part_1.pdf
Pt-2 : http://www.centurylink.com.hk/files/century_link_sales_brochure_part_2.pdf
Pt-3 : http://www.centurylink.com.hk/files/century_link_sales_brochure_part_3.pdf
Pt-4 : http://www.centurylink.com.hk/files/century_link_sales_brochure_part_4.pdf

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OffThePeak 5 yrs ago
Tung Chung Development Traps in a Dilemma

Along the coast of Tung Chung is a wall of towering apartments, offering tourists their first glimpse of the new town and the high-rises typical of Hong Kong. The airport town has long been a haven for flight crew and budget-conscious white-collar workers, though local residents would argue otherwise.

Literally meaning “eastern stream,” Tung Chung was believed to be a small fishing village and farming town populated since the Song Dynasty in the twelfth century. It wasn’t until the 1990s that it was earmarked as a new town on northern Lantau Island designed to support the development of the new airport at Chek Lap Kok.

Private housing estates dominate the heart of the neighbourhood, boasting clubhouses and podium gardens. Housing in Tung Chung is known for its affordability, with prices between $5,000 and $6,000 per square foot, compared to West Kowloon’s heftier $10,000 per square foot according to Midland Realty. Rents for private flats fetch $10,000 on average.

Tung Chung Crescent and Seaview Crescent were the area’s forerunners. Other notable developments include the pet-friendly Caribbean Coast and Coastal Skyline, offering apartments ranging from standard onebedroom flats to more luxurious duplexes sized over 1,200 square feet.

“When I first moved to Tung Chung, I enjoyed the tranquillity here — where you could enjoy a view of the mountain and the sea, and get the feel of living a country life in the city at home,” says Shirley Lau, a Tung Chung resident who moved from Kowloon’s Tai Kok Tsui eight years ago. “But now on holidays, every corner in Tung Chung is crowded with people.”

The widespread perception to Tung Chung residents is that the new town is more a tourist hub rather than a place to call home. Disneyland is just one MTR station away from Tung Chung; Hong Kong International Airport is a short bus trip away. The Citygate outlet mall, adjacent to the upmarket Novotel Citygate, is not only popular with Hongkongers, it has become tourists’ lastminute shopping spot. Since the opening of Ngong Ping 360, hundreds of tourists flock to Tung Chung terminal every day for a cable car ride to the big Buddha and the Po Lin monastery on the other side of the island.

And there is this dark side of the boondocks, behind the luxury apartments. Notorious for its remote location and lack of basic facilities, the isolated neighbourhood has long struggled to be self-reliant, thanks to its “flawed” design. It wasn’t until two years ago that a public swimming pool and library finally opened, though an acute hospital was set for completion by the end of 2012.

A somewhat inconvenient truth is that 22 percent of Tung Chung’s residents live below the poverty line, surpassing that of Sham Shui Po and Yuen Long statistics show, not to mention the hefty transport costs that become an extra burden for residents. Home to half of the new town’s population, public housing estates in Tung Chung — just about a five-minute bus ride fro...

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OffThePeak 5 yrs ago
... Some speculate as to whether Tung Chung is on the verge of becoming the next Tin Shui Wai, the “city of sadness.”

Nevertheless, others anticipate a brand-new Tung Chung in the very near future. The city’s chief executive is committed to giving Tung Chung a fundamental facelift. Chief Secretary Carrie Lam Cheng Yuet-ngor called Tung Chung a “bridgehead economic zone,” a potential regional logistics and business hub. A commute from Tung Chung to Central is a 20- to 30-minute ride via the Tung Chung MTR line, which also stops at Tsing Yi and Kowloon stations. Ferry services link Tung Chung with Tai O and Tuen Mun.

Under a concept plan for Lantau published as early as 2007, the Tung Chung new town is slated to grow twice its size, with its population tripling to 230,000 and with more parks and recreational facilities to be built, though construction isn’t expected to begin until 2020.

>> more: .../tung-chung-development-traps-in-a-dilemma/

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iflylow 5 yrs ago
From today's Standard:

It mentions that Century Link is more oversubscribed than last year's City Point, you OTP pointed out reignited the property market.


Tung Chung flats frenzy

Adam Xu

Friday, January 02, 2015


ADVERTISEMENT


Century Link by Sun Hung Kai Properties (0016) took in more registrations of interest than any other projects launched after the First-hand Sales Ordinance took effect last year.
By yesterday evening, the Tung Chung development had received more than 13,800 submissions of interest for its first 300 units, making them more than 45 times over-subscribed. This surpassed a record 13,500 registrations Cheung Kong Holdings (0001) received last year for its City Point units in Tsuen Wan.

Potential home buyers including foreigners are attracted to the project by its modest pricing an average HK$10,965 psf for flats sized from 408 to 644 sellable square feet.

A man surnamed Lo said such moderately priced new apartments are rare downtown, adding: "The location of the project is inconvenient for commuting. But to own a home, I have no choice."

Sales that will kick off tomorrow are set to extend a fervor in the local primary housing market, where 16,698 registrations were recorded last year, is soaring 70 percent from the 2013 level to hit a seven-year high.

That contrasted with a recovering yet still chilly resale market. The Land Registry logged 49,286 deals of used homes in 2014 through December 30 the second lowest in the past 11 years despite rising 18 percent year on year.

Overall 81,000 properties were registered in 2014, up 15 percent from 2013.

But the property market was boisterous over the Christmas-New Year holiday. On Thursday, a 310-sq-ft apartment at Shatin Center found a buyer just two days after it was posted, changing hands at HK$3.98 million or HK$12,839 pssf. The price was 15 times the unit's value when it was bought in 1980 at HK$253,000.

Meanwhile, SHKP said eight million shoppers visited its 12 local shopping malls in the six days leading up to New Year's Eve, rising 16 percent from a year earlier. That translated into revenue of HK$160 million, up 18 percent.

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OffThePeak 5 yrs ago
Let's see how long lasting the drop is.
It can make up a 3% drop pretty quickly

The smart thing might be to buy in an area you like, which is not getting new supply,
if you really want to live there. Or wait, if you want to live in a "cheaper" area like LOHAS that gets plenty of supply

Of course, if/when rates finally rise, you may get a much bigger drop.
But you might be waiting another year or more for that, with prices meantime moving higher.

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traineeinvestor 5 yrs ago
SHK sold all 300 flats in it's latest Tung Chung development in less than 7 hours: http://www.scmp.com/...ties-sold-out-7

"Properties on sale included flats with one or two bedrooms and net floor areas ranging from 408 to 645 sq ft, priced at HK$4 million to HK$6 million.

Many buyers had their eyes on the smaller one-bedroom flats, which had sold out by early afternoon, according to the property agents.

The cheapest flat was a 412 sq ft unit on the first floor priced at HK$4.09 million before the discount - or HK$9,948 per square foot in terms of saleable area. After the discount of up to 10.5 per cent, the price would be HK$3.66 million, or HK$8,904 per square foot."

13,800 people registered as prospective buyers of the units.

This bit at the bottom of the article caught my attention:

"Midland Realty expected average home prices in the New Territories to go up by 10 per cent over the next year, passing the HK$10,000 per square foot mark."

While Midland is IMHO talking their own book, those who anticipated Tung Chung's pricing gap with other NT locations to close look like being proved correct.

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Steve06 5 yrs ago
has anyone experiences with village houses in the TC area or Yuen Long? any bargains available

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OffThePeak 5 yrs ago
I have an old contact who specializes in that sector.

He works for Tung Chung Properties (if he hasn't moved)

Send me a PM, and I will give you his name.
You do not need to mention my name if you contact him.

WHY should there be any bargains now?
The market is bound to be hot in TC, after the very successful launch of Century Link.
The brief dip, if there actually was one, on price confusion, is likely over.

Why should any holder of a Village House want to sell for a Bargain price now?
If you want a bargain, it is most likely in a "soft" market. Don't you agree?

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OffThePeak 5 yrs ago
I have an old contact who specializes in that sector.

He works for Tung Chung Properties (if he hasn't moved)

Send me a PM, and I will give you his name.
You do not need to mention my name if you contact him.

WHY should there be any bargains now?
The market is bound to be hot in TC, after the very successful launch of Century Link.
The brief dip, if there actually was one, on price confusion, is likely over.

Why should any holder of a Village House want to sell for a Bargain price now?
If you want a bargain, it is most likely in a "soft" market. Don't you agree?

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OffThePeak 5 yrs ago
Haha.
Seems like the brief window in TC prices, has come and gone ... so very quickly

Caribbean Coast : 6,537.82 $8,766.10 2.15 %
Coastal Skyline - : 8,124.54 10,807.13 2.76 %

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OffThePeak 5 yrs ago
Centaline produces a weekly index.

Latest was released on Friday, 09.01.2015, and:
"latest on 2015/01/09; reflecting secondary private residential property price from 2014/12/29 to 2015/01/04"

So the data is a few days old.
Once upon a time, when I lived in TC, I would go into the grainy detail, and see which particular flat sales would push the index up and down. I am not so interested now. But obvious, the sale of one or two low floor flats may push the index down. And the announcement of a cheap price on a new project might rigger some sales - which is what I think happened.

Obviously, the overwhelming demand we have now seen for Century Link in TC will help push the secondary market higher.

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OffThePeak 5 yrs ago
Buying a property now, I would not advise.

I just SOLD my nice modern 2BR flat in the Olympic station area, and moved into a smaller and less comfortable place, in a faraway corner of the NT.
This was a very intentional, and long-planned downsizing move.

All my cycles suggest that we should have a Peak in 2016 +/- one year, ie 2015-2017.
Currently, I think it may be happening sooner rather than later, and very possibly before year end. So if you buy now, you may be buying right at the Top of the market. Unless you have money to burn, it may prove painful.

Question: Why buy now, when we have been through several YEARS of better buying opportunities?


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OffThePeak 5 yrs ago
Re: TUNG CHUNG

I said before:
"+ At about $6,000 psf, Gross (at Caribbean Coast, where I used to own several flats), TC is probably the cheapest decent "expat friendly" area in HK"

Prices are higher now: $6,508 psf, Gross at CC.
But I still think TC represents decent relative value. But in a sliding market, all properties will fall. For instance, if HK property prices fall 40% on average, they might fall 30-35% (or even the same as the rest of HK.) That may be outperformance, but it would still be painful

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