|
 
Last week, famous cartoonist Ma Wing-shing bought a house at the
prestigious Severn No 8 development on The Peak for the bargain
price of HK$76 million, or HK$23,030 per square foot, from a
businessman who had purchased the prime property for HK$93 million
just two years ago.
Ma's lightning deal - it was said he took only 30 minutes to make a
decision - to acquire the property at half the price of what it
might have fetched several months ago, has not only hit The Peak
market like a thunderbolt, but also brought into question the
pessimism prevailing here.
Who was right - or smarter - in this case?
There is no absolute answer to the question because it all depends
on the individuals concerned. While only the vendor can say whether
he was under financial pressure, prompting the slash in the price,
the event does point to a fact many of us may miss as society
concentrates on the dark side of the financial crisis.
If the stock market is used as a yardstick, one would be right in
saying we are caught in a situation reminiscent of the 2003 SARS
outbreak, or the 1997 Asian financial crisis. Only three weeks ago,
the benchmark Hang Seng Index plunged towards the critical 10,000
level amid a spate of fire sales.
However, one might have a completely different outlook if the wealth
accumulated by the people is considered.
I recall that Hong Kong bank customer deposits were slightly above
HK$3 trillion during SARS, whereas they were less than HK$3 trillion
during the 1997 financial turmoil.
Yet despite the stock market decline in the latest financial
meltdown, deposits still total about HK$6 trillion. So it is clear
that the people of Hong Kong has accumulated a lot of wealth since
the past crises, and bargain hunters with the means - such as Ma -
are waiting in the weeds for the right moment to strike.
Has the moment arrived finally? While it is largely a matter of
personal judgment, depending on how long one is prepared to hold
onto an investment, Ma's case - as well as the level of wealth in
Hong Kong as a whole - may show that the fundamentals are obviously
better than they were five years ago.
The cartoonist was not the only buyer interested in The Peak home.
But the others lost to Ma - not because he offered a higher price,
but because he could pay in cash, thus giving the seller a shorter
completion period.
As soon as the property purchase was brought to the public light, Ma
was approached by a number of agents, who said they had clients
willing to offer HK$80 million to HK$90 million for the house, which
would give him an instant windfall of more than HK$10 million.
He flatly rejected the overtures.
An insider said that the vendor instantly had seller's remorse on
the same night, wishing the deal had not been signed. But it was
already too late for anyone to back out, as it was considered a done
deal.
In the past several days, a property tycoon sounded very optimistic
that the real estate slump will bottom out before the end of the
year.
But it is hard to say for certain which way the ship will list. It
all depends on one's perspective.
- 2008
November 10 THE
STANDARD
|
