House on Hong Kong’s Peak Sells at 26% Discount as Market Struggles

A luxury house on Hong Kong’s Victoria Peak has reportedly sold at a 26.5 percent discount from the seller’s original asking price, after going unpurchased for the past seven months, according to local media accounts.

House No 5 at 28 Barker Road, a billionaire’s retreat overlooking the city’s Hong Kong harbour, is said to have sold for between HK$610 million ($77.7 million) to HK$620 million according to brokers working in the neighbourhood cited in a report in Hong Kong’s Apple Daily. The price for the house, which has a gross floor area of 5,700 square feet (529.5 square metres) house works out to as much as HK$108,772 per square foot.

The home, which comes with a private swimming pool and two parking spaces, finally found a buyer after the seller, said to be named Yu Feng, backed away from the asking price of HK$830 million that he had decided on when putting the unit on the market last August. The final agreement knocks as much as HK$220 million off of the transaction cost as demand for ultra-luxury homes dips in the world’s most expensive real estate market.

Get a Private Pool at a Discount

The villa’s new owner will take possession of a home with a 940 square foot garden and 1,214 square foot terrace in one of Hong Kong’s most exclusive neighbourhoods. In case the new homeowner gets tired from a swim in that private pool, which has a 180-degree ocean view, there’s even a private elevator to carry them away without need for those wearying stairs.

Other buyers of houses in the project, which was originally developed by what is now CK Asset Holdings, include Paul Hastings partner Raymond Li and billionaire mainland art collector Qian Fenglei. Members of the family of Henderson Land patriarch Lee Shau-kee live close by on Barker Road, which is also home to the official residences of some of Hong Kong’s top officials.

Yu Feng is said to have purchased the home in 2015 for HK$542 million, and booked an increase in capital value of around 12.5 percent over the past three years.

Hong Kong Luxury Market Stumbles

The discounted luxury transaction is the latest sign that 2019 is a new year in Hong Kong, where just a few months ago, posh properties were trading for record prices.

In November last year a house overlooking Deep Water Bay on the south side of Hong Kong island was sold to an unidentified buyer for HK$800 million, or HK$180,000 per square foot, setting a new record for the most expensive home in the Asian financial hub.

That sale on the south side broke a record set at the Mount Nicholson project at the Peak when Junson Capital boss and Longfor Properties co-founder Cai Kui, paid HK$1.399 billion to acquire a 9,217 square foot home at a price of around HK$151,985 per square foot.

With tighter lending conditions having had a major impact on the mainland since mid-2018, however, many potential buyers have been sapped of both credit and confidence.

In December an unidentified buyer agreed to purchase House No 16 at Mount Nicholson for HK$90,484 per square foot, or nearly 7.5 percent less than another buyer had paid for the nearly identical house next door in April.

Within less than two weeks, however, the Hong Kong identity card holder had forfeited a HK$36 million deposit to walk away from the HK$721.88 million purchase as experts began predicting a downturn in the local housing market.

While some analysts are still predicting that home prices will climb, in February Justin Chiu, an executive director with CK Asset, forecast that housing values could drop 10 percent in 2019, with another eight to ten percent fall next year.