UPDATE 2-Sun Hung Kai forecasts resilient Hong Kong property demand
(Adds details, analyst comment)
By Yimou Lee and Twinnie Siu
HONG KONG Feb 28 (Reuters) - A healthy Hong Kong economy and ultra-low mortgage rates could spur first-time buyer sales and cushion the blow of tightening measures, the world's No. 2 property company by market value Sun Hung Kai Properties Ltd said on Thursday.
Property developers in the Chinese special administrative region, including New World Development, have this week forecast concrete demand in the residential property sector despite government intervention to calm the market.
Authorities imposed a sixth round of steps last week to rein in prices that have doubled since 2008. The measures include higher stamp duties and home loan curbs on transactions.
Analysts say steps to curb prices in one of the world's most expensive housing markets seem to have had limited impact on the bottom lines of Hong Kong's property tycoons.
"The stamp duty doesn't affect first buyers and those who want to switch houses, so developers will of course switch to small- and medium-sized units," said Wong Leung Sing, property analyst at Centaline Property Agency, adding more tightening measures were on the cards.
Sun Hung Kai, which reported fiscal first half earnings that beat forecasts, lowered its sales target for this financial year by 9 percent to HK$32 billion, but remained upbeat about the market.
The company controlled by the Kwok family which was listed third on the 2012 Forbes ranking of Hong Kong's richest people, still managed to deliver its second best six-month profit ever.
It said a majority of projects for sale over the next nine months would be small to medium-sized units, focusing more on upgrading demand and first-time buyers.
Sun Hung Kai's local competitors have also seen little impact from the cooling steps, including a 15 percent tax on foreign buyers imposed in October.
On Wednesday, New World Development recorded a 91 percent year-on-year rise for net profit in the fiscal first half, while Sino Land's underlying net profit jumped 80.5 percent during the same period.
"Because the implementation of measures is so frequent, it will somehow affect the sales schedule," said Lau Ka-fai, chief analyst at Midland Realty.
"But overall we still believe property developers should continue to sell more units to the market."
Sun Hung Kai on Thursday reported an underlying profit of HK$11.5 billion ($1.5 billion), beating forecasts of HK$10.64 billion by four analysts polled by Reuters. The result compared with an underlying profit of HK$11.8 billion a year earlier.
The Hong Kong property sub-index, which includes other property bellwethers such as Li Ka-shing's Cheung Kong (Holdings), has fallen 5 percent so far in February, lagging a 3 percent drop in the benchmark index.
Sun Hung Kai's shares rose 0.8 percent on Thursday ahead of the results, lagging a 2 percent rise in the benchmark index. (Reporting By Yimou Lee and Twinnie Siu; Editing by Anne Marie Roantree, Jeremy Laurence and Ryan Woo)
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