New World cautious with new target despite record sales

New World Development kept a conservative target for contracted sales in the fiscal year to June 2015, even though its contracted sales hit a record in the previous financial year.

The developer took advantage of improving sentiment in the property market by launching new projects as contracted sales hit a record HK$20.6 billion for the 12 months to June 2014, more than double the sales target of HK$10 billion.

"The property sales were faster than our expectations," New World chairman Henry Cheng Kar-shun said yesterday. "Our sales target for the new financial year is conservative."

The developer's contracted sales target in the current financial year to 2015 has been set at HK$11 billion to HK$12 bil- lion. In the first quarter of the existing financial year, the firm has already generated nearly HK$5.9 billion from contracted sales.

Cheng believes property sales would remain healthy because housing demand is strong. He added that prices were not likely to weaken in the future.

"Property prices are unlikely to drop because of the high construction cost. It cost about HK$4,000 per square foot. Developers have to sell the flats with a higher price in order to make money," he said.