(Adds details, analyst comment)
By Yimou Lee and Twinnie Siu
HONG KONG Feb 28 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
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)