The Hong Kong Monetary Authority has recently cut interest rates for the third time this year by 25 basis points to 2.25%, following a rate cut of the same amount by the US Federal Reserve. But this time, many local banks have followed suit, among them HSBC, Standard Chartered and Bank of China. This was the first time in 11 years that they cut their interest rates.
In view of a struggling global economy and continued local social unrest, investing conservatively is preferred, despite the extremely low savings on deposit rates, earning next to nothing in interest. While many entertain the idea of “cash is king” amid low investment sentiment, and as a result of the interest rate drop, there are just as many adjusting their investment portfolio, looking at various districts, banking on the lower lending costs and possible momentum gain in the residential market.
Constructed from the former Kai Tak Airport site and its surrounding reclaimed land, the Kai Tak Development area in Kowloon East is a comprehensive project integrating an international cruise terminal, urban green spaces, hotels, flats, offices, sports and leisure facilities. The entire development is divided into three stages and is set to be completed in 2021.
Boasting a premier urban location, the Kai Tak site is a focal area for massive development under the government’s ambitious plan to position the site as the city’s second Central Business District (CBD2), which will not only turn Kai Tai into a world-class business destination, but drive the global trend of decentralisation by drawing numerous workers and residents into the area, thus increasing the rental demand for commercial and residential submarkets. Needless to say, the current low interest rate environment makes it easier for people to bring forward purchases.
With all the perks of a CBD, along with a wide range of infrastructure and recreational spaces, a comfortable living environment would be expected of the future of Kai Tak. Coupled with the forthcoming Sha Tin to Central Link, MTR stations such as Kai Tak soon to open in the next quarter, ferry services between Kwun Tong, Kai Tak (Kai Tak Runway Park Pier) and North Point, several existing bus routes possibly extending service to Kai Tak and an elevated monorail running through Kowloon East, Kai Tak will deliver an unprecedented level of convenience for its residents.
According to data from squarefoot.com.hk, Kai Tak had an average per-square-foot price of HK$ 24,952 in October, a 62% increase from the previous month. Many of the new residences are completed and occupied, such as Victoria Skye, One Kai Tak and K. CITY. Primary homes currently open for sale are Vibe Centro and Upper River Bank.
Selected Residential Developments
Located at 9 Muk Ning Street, Vibe Centro is a completed project owned by Poly Property Group. Consisting of 930 units across four blocks, flats are mainly in one- to two-bedroom configurations, with some enjoying views of Victoria Harbour. The development boasts a 35,000-square-foot clubhouse, with more than 32 types of indoor and outdoor facilities, including swimming pools, a gym, children’s playground, banquet room, reading room, restaurants and more. Unit 33A in Block 2B, a four-bedroom unit with harbour views overlooking Kowloon Bay and the island side, with a saleable area of 1,010 square feet, was recently sold through tender for HK$38.17 million or HK$37,800 per square foot. It sets a new transaction record for the project’s south-facing four-room flats. 110 units remain to be sold.
Slated for completion in 2021, Upper River Bank at 11 Muk Tai Street is a collaboration by KWG Group and Longfor Group, offering 667 flats in seven blocks, with saleable areas from 332 to 2,566 square feet, mainly in two- to three-bedroom configurations. Unit 21F in Block 1, with a saleable area of 1,063 square feet, was recently sold for HK$34 million or a per-square-foot price of HK$32,001, a record high for Upper River Bank.
Situated at 10 Muk Ning Street, this estate was developed by Wheelock Properties and completed in 2018. It has 648 units in eight blocks, with saleable areas measuring 275 to 1,530 square feet, in studio to four-bedroom configurations. A high-level unit E in Block 1, with a saleable area of 360 square feet, was recently leased out at HK$16,000 or HK$44 per square foot.
Things to know before moving into Kai Tak
- New bus routes
In light of a growing population pouring into the Kai Tak Development area, Citybus, one of the three major bus operators in Hong Kong, will run three new bus routes–20, 22, 608—to the area from Tai Kok Tsui, Kowloon Tong and Sai Wan Ho, respectively. Another airport bus route, A23, will soon serve the area.
- School net
Kai Tak’s primary school net is No. 34, which includes Farm Road Government Primary School, Ma Tau Chung Government Primary School and Chan Sui Ki (La Salle) Primary School. Its secondary school net belongs to the Kowloon City district, which has Homantin Government Secondary School, Maryknoll Convent School (secondary section) and Heep Yunn School. The closest international school is Kellett School in Kowloon Bay, offering kindergarten, primary and secondary education.