Buying Specifically in Carib.Coast, Tung Chung (Lantau)

[drbubb]

I talked to an agent on Sunday who said that you can get a low floor A or H flat in Phase 1 for 3.5 and in phase 2 the same flats on any floor can go for 3.7m. I wont be surprised if prices drop down to where they were in Dec. 2005 - Jan. 2006.

 

There was a "shocking" sale of a high floor tower 7, "A" flat* at $3.66 million.

The agents are now trying to talk sellers down to $3.7 million, and they are trying to line up buyers at the same price.

But rental returns remain attractive for those with "old" loans.

 

I think the market will probably go frozen for a while, since I dont know how many desperate sellers there are.

Do remember the agents are starved for business and are using any trick they can find to stir up business, and "talking

the market down" seems to be the winning tactic at the moment.

 

======

*The "A" flats in that tower are among the least attractive large flats, given the views

[surfdude]

The "A" flats in that tower are among the least attractive large flats, given the views

 

Do you say this because the views are towards Tuen Mun and their is the uncertainty of what will be developed on lot 55b? They will also have a good view of the construction of the border crossing station for the Macau- HK bridge once that gets under way. I have always thought G&H flats have better views than A&B. Any other thoughts on this?

[drbubb]

Do you say this because the views are towards Tuen Mun and their is the uncertainty of what will be developed on lot 55b? They will also have a good view of the construction of the border crossing station for the Macau- HK bridge once that gets under way. I have always thought G&H flats have better views than A&B. Any other thoughts on this?

 

55b is the main problem, I think

Yes, I agree that G&H views are better

 

[drbubb]

CC.org has become unbearably nasty - what a bunch of clowns !

So I posted this:

 

(This may be my last posting)

 

Sorry, guys, I got it wrong. I was too optimistic about HK Property.

It is having problems coping with the most severe financial panic in about 80 years.

 

Those here, who foresaw it, or at least approached the market with more caution, I congratulate you.

May you continue to thrive in what may be a difficult few years. Thank goodness, I have some gold

and some good gold shares tucked away. They may prove a real lifesaver in the days and weeks ahead.

 

I see no point in continuing to post on what has become a nasty thread people by some rather

unpleasant people. Those are interested in a more balanced discussion will know where to find it.

[surfdude]

CC.org has become unbearably nasty - what a bunch of clowns !

So I posted this:

 

(This may be my last posting)

 

Sorry, guys, I got it wrong. I was too optimistic about HK Property.

It is having problems coping with the most severe financial panic in about 80 years.

 

I have followed some of the threads on CC.org as a guest and agree that many there seem to post as a cheap form of entertainment and have nothing meaningful to add to a useful discussion. It is a bit disappointing that this represents the community in which we live but that's life.

 

From your above statement are you having misgivings or rethinking about the property cycle in HK and that this is a correction (albeit a severe one) and that Henderson's explosive phase is still ahead?

 

The Hang Seng (all markets) really took a clobbering today and breached the 16000 support level. The developers are all at new lows for the past 3 years or more.

 

However, there could still be a big bounce ahead once the low is found. Just as there was in 2004 after the low of 2003.

[Haggis]

CC.org has become unbearably nasty - what a bunch of clowns !

So I posted this:

 

(This may be my last posting)

 

Sorry, guys, I got it wrong. I was too optimistic about HK Property.

It is having problems coping with the most severe financial panic in about 80 years.

 

That's a shame for them because I always find your analysis interesting and provocative - even when I disagree with your conclusions. Well, some people can't involve themselves in rational disagreement without reducing things to a feud. I suppose many of the internet forums do attract a lot of pretty boorish behaviour.

 

 

[drbubb]

I have followed some of the threads on CC.org as a guest and agree that many there seem to post as a cheap form of entertainment and have nothing meaningful to add to a useful discussion. It is a bit disappointing that this represents the community in which we live but that's life.

 

From your above statement are you having misgivings or rethinking about the property cycle in HK and that this is a correction (albeit a severe one) and that Henderson's explosive phase is still ahead?

 

The Hang Seng (all markets) really took a clobbering today and breached the 16000 support level. The developers are all at new lows for the past 3 years or more.

 

This is a very deep test.

I certainly want to see the HKSI climb back over 16,000 quickly, I hope before the end of the week. Else the odds of a deeper

fall towards 2004 lows (or worse) increases.

 

I will probably post on CC.org under a different name, albeit much less. I dont see much point in posting detailed prioperty market

comments or charts there, since they were little appreciated. In fact, some of my work: like the Builder bellwether, predicted a

deeper downturn. It was unwise for me to disregard it, and focus on other factors.

 

It is possible HK property may get some joy from the global reflation which has begun

[surfdude]

Big plunge in stock markets continues today with the Nikkei in Japan down over 10% and the Hang Seng down around 8%. There seems to be no abatement to the fall. People are scared and want to cash out.

 

I have also noticed big gains in the US currency. Just read an article on Reuters saying the US$ is viewed as a safe haven currency and it will continue to gain. Maybe keeping the peg for HK is good. I just talked to a friend who changed a Aus. Mortgage into HK$ and saved 35% by doing this (he works in HK).

 

How low is the Hang Seng going to go? Is just the beginning of a larger sell-off?

[drbubb]

Another support level gone at 16,000-ish. That's not good news.

 

This panic continues,

I am now watch the CSI.300 to see if if can hold those old lows near CSI-1800

 

The overnight FXP (a double short on China) looks 'orrible.

 

The big problem is the fundamentally-driven fear that Central banks cannot unfreeze Libor lending.

I am getting ready to pray

 

== ==

(added in edit):

CSI.300 Value

1,903.56 Change-91.740

% Change -4.598

High 1,920.17 Low 1,881.67 Open 1,913.26

 

-4.6% : could be worse, with HK down 7%, Japan down 9%

 

MORE here: http://www.greenenergyinvestors.com/index....=1921&st=80

[tedlem]

I don't feel that they market is ready to go back up any time soon.

 

There are just too many signals that are not pointing to a buy confirmation. Perhaps there is too much of a delay.

 

Don't know if the 16,000 will hold very long. The volume has been quite week and it looks like liquidity is an issue and desperate sellers will be forced to sell. Now the question is whether we have squeezed and exhausted the weak players or is there more to sel?

 

Tomorrow will be a determining factor. I'm looking more torwards 14,000 because this is a week market.

 

[tedlem]

Hey. How do you paste pictures that can be seen in the thread and without having to make it so ugly like mine?

 

ie into the text?

[drbubb]

I don't feel that they market is ready to go back up any time soon.

 

I have posted a reaction to this on the HK Property Cycle thread:

http://www.greenenergyinvestors.com/index.php?showtopic=4190

[drbubb]

[drbubb]

(per HPark, on CC.org):

 

Hang Seng index started the year well. Back above 15,000

 

and the prices in Caribbean Coast has certain firmed a little:

 

12/01/2008 : 56.92 : 54.99 / $2,500e

12/08/2008 : 57.15 : 55.19 / $2,512

12/15/2008 : 56.71 : 54.77 / $2,541

12/22/2008 : 56.93 : 54.99 / $2,670e

12/29/2008 : 56.78 : 54.89 / $2,581

 

Not a huge move up, but an improvement nonetheless

 

Chart

[drbubb]

$3,500 psf achieved !

 

Some very nice prices being achieved for higher floor large flats now, at CC.

 

An agent just told me that an H-flat in Tower 10 on a "high floor" (40's?) went for $4.2 Million ($3,500 psf)

Apparently, this has shocked the market somewhat since some buyers think they can still buy high floor flats at under $4.0 Million.

 

But, hey, who knows. There might be some sellers of A flats out there, who have some different price ideas, or the market "heat" we have be seeing may cool off. Some agents thought last weekend was quiet, because of flu related concerns. Were they temporary, or are they still around?

[drbubb]

That 46x Mass market index should prove a fairly good indicator for CC,

unless it gets a "re-rating" at some stage.

 

Perhaps the beginning of the construction of the Bridge to Macau

will help to inspire a re-rating of the whole of Tung Chung

 

 

I am now using a formula to value all my CC flats "in real time"

 

(MMkt.Index x 46) + Premium = Value per SF x size (in sf) = Notional Value

 

So for say a 40th floor "C" flat in phase 2:

(MMkt.Index x 46) + Premium = Value per SF

( $ 62.56 x 46 ) + $ 75 = $ 2,956

Value per SF x size (in sf) = Notional Value

( $2,956 x 729 ) = $ 2.15 Million

 

That's the same value that Hang Seng gives the flat.

 

I have to watch comparative sales to solve for the "Premium"

 

Using the same formula, for the same flat you get:

 

AT THE LOW (MMI- 55.00): $ 1.90 Million - Dec.2008

AT THE High (MMI- 71.00): $ 2.44 Million - Mar.2008 (drop in Dec: -22%)

[drbubb]

 

 

Longer Term, since 2003

[drbubb]

ADDED to Header

 

 

Estimated data, derived from "eyeballing" charts:

xx

[drbubb]

There have been several posts on CC.org from people seeking A&H Flats.

 

1/ Looking for Unit A or H perferably Tower 6 or Tower 16 for rent

2/ Want to RENT: A or H (low, mid or high floors)

3/ Looking to rent A/H at CC

 

(I posted this there, to hopefully get a more balanced discussion going.

Frankly, I got sick of "greedy tenants" trying to force rents down"):

 

In contrast to last year, when A and H flats were in a glut, agents tell me that they are scarce this year because:

 

+ Rentals fell, and that attracted people from other areas of HK, who liked how much space they could get for so little money in CC,

 

+ Many "own use" buyers started snapping up these flats. With rates so low, and with some nice flats once available below $4.0 million, it was cheaper to buy than to rent

 

+ People in the "small 3 BR" (B and G flats) moved up to A and H, because for the same money they paid in the prior year, they could afford the larger 3BR flats. (In fact, that's what one of my tenants did. Rather than accepting a lower rent, I jus sold the flat, capturing a small profit versus my early 2008 cost.)

 

I suppose this is just natural - how a market adjusts. And it just shows how pricing power swings back and forth between Landords and Tenants.

[drbubb]

(as also posted on CC.org, where there seems to be little interest):

 

Last week brought the first dip in Centaline's MMI in several weeks.

 

 

Week Ending: CLIdx : MMI : ... x 46 .. / CaribC

05/17/2009 : 64.30 : 62.56 ... $2,878 / $2,787

05/24/2009 : 64.35 : 62.72 ... $2,885 / $2,804

05/31/2009 : 65.49 : 63.62 ... $2,926 / $2,944

06/07/2009 : 65.00 : 63.18 ... $2,906 / $2,881

06/14/2009 : 65.82 : 64.07 ... $2,947 / $2,874

06/21/2009 : 67.11 : 65.49 ... $3,013 / $2,967

06/28/2009 : 68.42 : 66.77 ... $3,071 / $2,955

Up from LOW 20.6%: 21.9%= MMI x46 / CaribC

 

07/05/2009 : 67.59 : 65.59 ... $3,017 / $2,906

 

Caribbean Coast continues its recent pattern of lagging a bit behind the MMI.

Did the rainy weather 2-3 weekends in a row have anything to do with it?

[drbubb]

The Appreciating Coast (catch-up and more)

 

Caribbean Coast finally gains on the Hong Kong-wide indices.

 

Week==== : CCLI. : MMLI : MMx46 / CaribC

 

06/07/2008 : 70.26 : 69.77 : $3,209 / $3,295 (! High in CC ?)

. . .

06/28/2008 : 73.38 : 70.27 : $3,232 / $3,111

. . .

12/15/2008 : 56.71 : 54.77 : $2,519 / $2,541 (( LOW ))

Fall from HIGH

To the Low -22.7% -22.1% : MMI x46 -22.9%

. . .

02/24/2009 : 58.62 : 57.02 : $2,623 / $2,545 (double bottom in CC)

. . .

03/24/2009 : 59.43 : 57.90 : $2,663 / $2,540 (triple bottom in CC)

. . .

07/05/2009 : 67.59 : 65.59 : $3,017 / $2,906

07/12/2009 : 68.46 : 66.52 : $3,060 / $2,948

07/17/2009 : 68.62 : 66.73 : $3,070 / $2,996

07/24/2009 : 68.71 : 66.89 : $3,077 / $3,043

07/31/2009 : 69.44 : 67.10 : $3,087 / $3,140

08/07/2009 : 69.51 : 67.33 : $3,097 / $3,088E?

08/14/2009 : 70.12 : 67.62 : $3,111 / $3,206 +7.00% in a month!

Rise from LOW

Latest week: 23.7%: 23.5% : 23.5% / 26.2%

 

So we see:

CC is up 7.0% in a month, and 26.2% from the lows, versus only 23.5% for

Centaline's Mass market index since the Dec. lows

 

WHY THE RECENT BIGGER GAIN, relative to the indices?

 

 

Several possible reasons:

====

+ CC lagged for a while. Because of 4 weeks in a row of typhoons and rainstorms,

fewer people to the long trip to Tung Chung to go flat-hunting. Now, with better

weather, the buyers are back and TC property is catching up.

 

+ Rents are rising in TC and CC in particular (but not in LBD)

 

+ People see they get "much for their money" in CC. Where else can you buy

so much space for $3,000-3,500 psf?

 

+ There have been some large flats sold at "fancy" prices.

 

+ The building is done (for the time being, at least), and so no more new supply

will be coming for many years. Compare with Tseung Kwan O (TKO), where the

they are less than 1/3rd of the way into building 50 new towers.

 

Can someone answer this question?

Why should TC be at $3,000-3,500 psf, when TKO is at $4,500-5,000 ?

In the long run, with the airport and the bridge (and hence a more "central" location,

shouldn't TC be higher ??

[drbubb]

Tung Chung and Tai Kok Tsui (HONG KONG) - Both Good for traders

 

So which is better, Kowloon or Lantau?

 

Lantau has alot going for it, but I like living in Kowloon too.

 

We still own the larger 3BR flat in Lantau, it is rented out now. But we have been selling some of the others with the objective of reducing total debt to zero. Once we sell another 1-2 flats we should get there.

 

The main advantage of the Kowloon location is the 30-40 minutes saved each time we travel to HK Island. Actually, even though Kowloon is called "the dark side" by some who live on HK Island, it is actually easier to get to Central from here than most places people live on HK side. Sure, there's less to do here within walking distance, but with the money one saves by living here, the commuting cost by MTR and even by taxicab is insignificant. As more expats come to realise that, I think this area will become more and more popular. As it is, I see more non-Chinese faces here all the time. The next good thing would be some nightlife, and a some good Western restaurants in Tai Kok Tsui. And maybe some more schools, for those who have kids of that age.

 

 

Some day, I will get round to taking some photos of the facilities in this building (Long Beach). They are really superb. The clubhouse was voted one of the Top 5 in all of Hong Kong, and indeed that is one important reason that I live here. Another is that rents fell by the time this flat was ready for move-in, and I did not want to "give it away" cheaply. when it offered so many advantages. So I ahd to convince my partner to downsize seriously from 1200 sf to 750 sf, so that we could squeeze in here. The great clubhouse facilities mad that downsizing much less painful. We both like it now, and she would like us to buy a larger flat here someday.

 

(Photo taken from our high floor flat in Tung Chung)

 

Caribbean Coast has a nice clubhouse and environment too, and some good shopping at City Gate. For those who flight out of the airport often, and do not need to be in Central everyday, CC provides unbeatable value-for-money. You can still rent a 1,200sf 3BR flat there for about HK$13,000 (that's about Pds 1,000 per month.) I think that is streets better value than you can get in London, and it comes with far lower taxes. Maybe one day the Day Traders will discover it, and they will be moving there from all over the world.

 

For those who want to live here permanently, there's a Investor's Scheme, where if you invest a minimum of HK$6.8 Million in property or HK financial assets, you can gain the right of permanent abode. I plan to apply for this soon, since as it is, I must leave HK within 90 days, to restart the clock. And I do not have the right to work here, and "take a job away from a HK citizen."

 

For Gold traders, here's a little item that appeared in today's paper:

Precious metal depository opens

 

 

The precious metal depository at Hong Kong International Airport opened today and was appointed by the Mercantile Exchange as a gold storage and physical settlement venue for its members and market participants.

 

Unveiled by Financial Secretary John Tsang at a ceremony today, the 340-square-metre depository will enhance Hong Kong's position as a trading and logistics hub for precious metals by providing secure storage and physical settlement services to central banks, commodity exchanges, bullion banks, precious metal refineries and issuers of exchange traded funds.

 

Mr Tsang said: "The depository will help tap into opportunities from the growing demand for gold and other commodities in the region." He added this ties in with the Government's policy to enhance Hong Kong's position as an international financial and logistics centre.

 

/more: http://www.news.gov.hk/en/category/busines...e8714991e12.htm

[drbubb]

Public Housing next to phase 1:

http://www.districtcouncils.gov.hk/island_..._2009_09_EN.pdf

[drbubb]

TOP FLOOR - Tower 16 : A snip at $15 Million?

 

(Per Advert):

 

Location : Tower 16 Flat A & H, 63rd floor. 7 minutes drive to airport & 10 minutes walk to MTR. Stunning views of the Sea and the HK airport

Accommodation : Grand entrance, Large Living & Dining area, Open Bar, 3 bedrooms, maid’s room, spacious dining area and space for a media room. Every room has the sea and airport view

Club Facilities : One of the best club houses, with 4 swimming pools, bowling, tennis, pool, Gym and other recreation services. Please visit Club’s website : http://www.caribbeancoast.com.hk/ch/ch.html

Caribbean Coast Bazaar : Shopping, groceries, restaurants and medical services are available in the complex

 

/see: http://www.geoexpat.com/classifieds/showpr...ct/86389/cat/55

[surfdude]

Public Housing next to phase 1:

http://www.districtcouncils.gov.hk/island_..._2009_09_EN.pdf

 

I remember reading the document when it was in the lobby of each building in the spring of this year. Interesting that none of the agents ever mentions this to clients. The buildings are actually quite high for public housing at 47 - 49 stories. Public Houseing will definately impact the area affecting views, community make-up and traffic.

 

Development schedule5.1 The revised public housing development is scheduled to commence in late 2010

for completion in 2015. To tally with the housing programme, Road L16 and

the associated infrastructure works are expected to complete in 2012.

 

So the construction is going to begin in about a year creating noise and air (dust) pollution for the area. I am surprised that the government is going ahead with building public housing on prime sea front property affording them the best views in the area. Misguided planning on the part of HK government once again?