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Should developers be allowed to hold back selling apartments in new buildings?

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  1. #11

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    Looks like Hang Lung made a mistake and waited too long to release the units in this case. What's the logic in releasing some of the units now?

    Also, moving into a 'new' 12 year old unit? I'm guessing there will be a bunch of problems with units that have been sitting for so long unused.


  2. #12

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    Should developers be allowed to hold back selling apartments in new buildings?

    Quote Originally Posted by jmbf:
    Also, moving into a 'new' 12 year old unit?
    I assume 25% discount means 25% below market rate for (new?) flats?

    Agree, the timing is strange indeed?
    - they know whats coming
    - they need money?
    Last edited by 100LL; 18-04-2016 at 05:33 PM.
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  3. #13

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    Quote Originally Posted by jmbf:
    Looks like Hang Lung made a mistake and waited too long to release the units in this case. What's the logic in releasing some of the units now?

    Also, moving into a 'new' 12 year old unit? I'm guessing there will be a bunch of problems with units that have been sitting for so long unused.
    i understand that the arm of the supplier is twisted (or you dont get the next job) to give a new 12 month warranty. but those AC units will not last long
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  4. #14

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    Quote Originally Posted by shri:
    Hows this different from someone buying 20 apartments / offices etc and keeping them vacant?
    If the unit is sold, even vacant, it is on the land registry, and someone is paying rent, rates, management fees, pay monthly charges if utilities are connected, etc. etc. but if first sale is not sold I wonder

  5. #15

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    Quote Originally Posted by Flat Hunter:
    Of course they should...any company should be able to sell their products any time they want. The main objective of any company is to increase shareholder value.
    You make it sound as if the whole housing / developer model is some sort of free market.
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  6. #16

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    Not only should they not be allowed to "hold back", they should also be made to build on purchased land within a reasonable time frame, otherwise they forfeit the land. Apparently some mainland cities have such conditions on some of their land sales. This will prevent large developers from building up land banks which they can use to manipulate prices to maximise their already obscene profits.

    In an interview a couple of years ago, a developer gave a ballpark figure of about $5000/sq ft construction costs for a regular HK flat. I don't work in the construction industry but I find it hard to believe that the cost (per unit area) of constructing a high-rise building costs more (much more) than a 2 storey brick house typical in Britain. A couple of years ago was looking at a new build in an expensive part of London, 3 floors with a total area of about 2000sq ft, cost just under £500K, which works out to £250/sq ft (remember this includes cost of land and cost of construction etc) which at that time would be about HK$3000/sq ft. The number of shared parts (roofs, walls, pipes etc) in a high-rise should dramatically reduce its cost compared to a house. But apparently this is not the case in HK. Recently I've spoken to various people about the cost of building a typical 2100 sq ft village house, and the ball park figure is around $2M, which works out to around $1000/sq ft.

    Plus it's not as if HK flats are anything special. With a few exceptions they all seem to be made with the same cookie-cutter. The flats in Shenzhen, Zhuhai, and even in 3rd tier cities like Zhongshan have much more variations in design and looks. The only thing local developers seem to be competing on is who can make the biggest, flashiest "club house" and common areas so they can charge a bloody fortune in management fees.

    Last edited by bugaboo; 19-04-2016 at 03:38 AM.
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  7. #17

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    Quote Originally Posted by bugaboo:
    Not only should they not be allowed to "hold back", they should also be made to build on purchased land within a reasonable time frame, otherwise they forfeit the land. Apparently some mainland cities have such conditions on some of their land sales. This will prevent large developers from building up land banks which they can use to manipulate prices to maximise their already obscene profits.

    In an interview a couple of years ago, a developer gave a ballpark figure of about $5000/sq ft construction costs for a regular HK flat. I don't work in the construction industry but I find it hard to believe that the cost (per unit area) of constructing a high-rise building costs more (much more) than a 2 storey brick house typical in Britain. A couple of years ago was looking at a new build in an expensive part of London, 3 floors with a total area of about 2000sq ft, cost just under £500K, which works out to £250/sq ft (remember this includes cost of land and cost of construction etc) which at that time would be about HK$3000/sq ft. The number of shared parts (roofs, walls, pipes etc) in a high-rise should dramatically reduce its cost compared to a house. But apparently this is not the case in HK. Recently I've spoken to various people about the cost of building a typical 2100 sq ft village house, and the ball park figure is around $2M, which works out to around $1000/sq ft.

    Plus it's not as if HK flats are anything special. With a few exceptions they all seem to be made with the same cookie-cutter. The flats in Shenzhen, Zhuhai, and even in 3rd tier cities like Zhongshan have much more variations in design and looks. The only thing local developers seem to be competing on is who can make the biggest, flashiest "club house" and common areas so they can charge a bloody fortune in management fees.
    I gather you never heard of the term buildings made from tofu then

    Hong Kong has much higher safety regulations and failsafe unlike some parts of China, especially ones governed by corrupted officials
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  8. #18

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    Quote Originally Posted by bugaboo:
    Plus it's not as if HK flats are anything special. With a few exceptions they all seem to be made with the same cookie-cutter. The only thing local developers seem to be competing on is who can make the biggest, flashiest "club house" and common areas so they can charge a bloody fortune in management fees.
    This is probably mainly due to government regulation that has stayed stagnant for the last 20 years. Other developed countries have gradually ratcheted up environmental and building codes to make for more sustainable lower impact housing with holistic town planning. Hong Kong Government is stuck with the same approach of economic segregation and building codes from the 1970's. Just appalling governance.

    Quote Originally Posted by bugaboo:
    The flats in Shenzhen, Zhuhai, and even in 3rd tier cities like Zhongshan have much more variations in design and looks.
    But they don't have a good reputation in terms of build quality and regulatory compliance. Pretty but not right over dull but safe. Corruption 'free' Hong Kong with its relatively free press keeping the system in check still appears to be a better (normal model).
    Last edited by East_coast; 19-04-2016 at 07:30 AM.

  9. #19

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    Original Post Deleted
    If a Government is involved there will always be corruption. It is a relative term. Hong Kong ranks a respectable 18th on the corruption index. But there is no collusion index unfortunately...

    China is at a lowly 87th and given the crack downs on press freedoms the medium term doesn't look so rosy.
    Last edited by East_coast; 19-04-2016 at 07:44 AM.

  10. #20

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    Quote Originally Posted by JAherbert:
    If the unit is sold, even vacant, it is on the land registry, and someone is paying rent, rates, management fees, pay monthly charges if utilities are connected, etc. etc. but if first sale is not sold I wonder
    Rent, management fees - from one pocket to another.
    Rates etc - marginal cost
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