Secondary financing for hong kong buyers

It has been announced that Hong Kong property developers may offer buyers additional financing...

Cheung Kong Holdings Ltd., the builder controlled by billionaire Li Ka-shing, is providing buyers at its Oceanaire project in the Ma On Shan district in the city's north with as much as 10 percent additional financing on top of their bank mortgages, the company said in a Sept. 21 statement.

Home transactions in the city have contracted about 33 percent since Aug. 13 when the government raised down-payment ratios and pledged to increase land supply to rein in home prices, according to Centaline Property Agency Ltd. The government has said it may introduce more measures to curb home values that have surged about 47 percent in 21 months to the highest since the last peak in 1997.

"These are almost standard practices by developers whenever transactions slow," said Wong Leung-sing, research director at Centaline. "The rest are probably just waiting to see if there's any backlash against Cheung Kong from the government. It's only a matter of time before they join in."

Sun Hung Kai Properties Ltd., Hong Kong's biggest developer, will this week begin marketing in Shenzhen, the Southern Chinese city across the border from Hong Kong, the Valais, a luxury housing project in the New Territories, the company said in an e-mailed press release on Sept. 21. Bonnie Ngan, a spokeswoman for Henderson Land Development Co., said in a phone interview the company has been offering buyers secondary mortgages on almost all its projects.

"Developers will constantly come up with new measures to boost sales no matter what the government does," said Centaline's Wong. "It's almost certain the government will announce more measures to curb prices."

Source: Bloomberg