Hong Kong developers launch price war to ‘kick-start market’ ahead of Fed rate cut

KT Marina, a residential project jointly developed by K Wah International, Wheelock Properties and China Overseas in Kai Tak, inaugurated the price war on Monday by slashing prices on 50 flats at its Phase I by up to 38.5 per cent. Earlier discounts stood at 22 per cent.

The average price per square foot for these 50 units – after discounts – was HK$17,384 (US$2,229), which was 12 per cent lower than the project’s first listing of 208 flats in October last year.

The prices were similar to the first listing launched in July by neighbouring project Pavilia Forest I, which was developed by New World Development and Far East Consortium. Those were the lowest prices in the Kai Tak area in nearly eight years, amounting to HK$16,008 per square foot.

KT Marina’s price cuts come as Hong Kong developers are poised to launch at least six new projects with a total of 2,800 flats in September as they bet on a more active local property market. Global markets were encouraged last month when Fed Chair Jerome Powell signalled that American policymakers were ready to reduce rates. The Fed raised its target rate 11 times from March 2022 to July last year, and has kept it unchanged in nine meetings since then. Its next rate-setting meeting is on September 17-18.

K Wah said market participants expect the US benchmark interest rate to be reduced this month, adding that this is the best time to buy a home due to widespread price cuts.