The froth is coming off Hong Kong's property market, with bidding at the biggest government land auction in two years failing to reach the high prices forecast by analysts.

Two residential sites on the Tai Po waterfront were sold yesterday at the low end of market expectations, a signal that developers believe property prices are close to their peak.

Average residential property prices in Hong Kong have risen 28 per cent this year, according to property benchmark Centa-City Index, raising fears of a property bubble.

South China Morning Post