The chase is on

A total of 30 luxury apartments at Wellesley on Robinson Road in Hong Kong’s Mid-Levels West went on sale on Jan 24 for an average of HK$230,000 per square meter, almost half the average price for prime projects in the zone.

The price is reportedly 42 percent lower than those of six new luxury houses sold in September 2015 at Cluny Park, and nearly half — or 49 percent lower than —that of the 12 units sold at 55 Conduit Road just two doors away.

At those levels, the unit price of some luxury homes in Shenzhen can now be rated as neck and neck with the SAR. China Resources Land project Top Mansion in the upmarket Nansha district near Shenzhen Bay went on the market last December and the highest average price has topped 200,000 yuan ($30,391), or HK$237,000 per square meter.

The total price of another home — a 687 square meter top-floor loft at Top Mansion, also in Nansha — was a whopping 137 million yuan, while the cost of the 30 units at Wellesley ranged from a comparatively paltry HK$24.14 million to HK$41 million.

London-based real estate consultancy Knight Frank expects Hong Kong to be the weakest performing luxury residential market in 2016, overtaking Singapore, according to its Prime Cities Forecast Report released on Jan 6.

The report estimates the annual price growth of Hong Kong’s prime residences to fall 5 percent, while Shanghai, as a representative of mainland cities, will likely see it increase 4 percent.

Analysts also noted that the Shenzhen market is becoming more appealing to buyers. Carlby Xie Jingyu, director of research at Colliers China, noted that the Shenzhen market is more stable compared with Hong Kong’s and it is less influenced by foreign economic fluctuations and international environment. The appreciation potential of Shenzhen’s primary housing sector is also larger than that of Hong Kong, he noted.

However, He Qianru, director of the Midland Realty research center, was confident that the Hong Kong luxury housing market is more superior as it is centralized, while some luxury projects in Shenzhen are located in low-priced residences and carry more risks.

Though prices of luxury homes in first-tier mainland cities may be going through the roof, the record of the most expensive apartment is still held by Hong Kong.

That honor went to a 46th-floor luxury duplex apartment at the 39 Conduit Road development in Mid-Levels, which sold in December for HK$103,761 per square foot, or HK$594.76 million in total, making it the most expensive apartment in Asia.

The overall outlook for this year’s luxury housing market in prime mainland cities and Hong Kong is expected to be “chasing each other”, as He Qianru put it.