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Abu Dhabi, UAEThursday 17 January 2019

Hong Kong property market stance to remain

No plans to change cooling policy but Finance Secretary says open to looking into ways to help those who find it difficult to make a down payment

Kowloon district of Hong Kong. Many residents find it hard to get on the property ladder. AFP 
Kowloon district of Hong Kong. Many residents find it hard to get on the property ladder. AFP 

The Hong Kong government has no plan to ease property market cooling measures, including the stamp duty on second homes or for overseas buyers, as many residents still can’t afford to purchase homes in the city, Financial Secretary Paul Chan said in a blog Sunday.

The government also doesn’t plan to lift the special stamp duty, which levies home owners who sell property within three years of purchasing, Mr Chan wrote in his weekly blog in Chinese. The goal is to fight short-term speculation, he said.

Mr Chan said he was open to looking into ways to help those who find it difficult to make a down payment, with current rules requiring home buyers to pay a substantial deposit. The government would consider factors including the extent and speed of the decline of house prices, the transaction volume, the future supply of residential estates and the overall economic situation, he said.

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After an almost 15-year bull run that made Hong Kong’s property market the world’s least affordable, home prices have fallen for 13 straight weeks since August, the longest losing streak since 2008, figures from Centaline Property Agency show. Concerns about higher borrowing costs and a looming vacancy tax have contributed to the slide.

The strike rate of mainland Chinese developers successfully bidding for residential sites is also waning, tumbling to 27 per cent in 2018 from 70 per cent in 2017, JLL’s Residential Sales Market Monitor released Thursday showed. Of the 11 residential sites tendered by authorities last year, only three were won by Chinese companies.

“The change in attitude can be explained by a slowing mainland economy,” said Henry Mok, JLL’s senior director of capital markets. “Throw in a simmering trade war between China and the US, the government has taken actions to restrict capital outflows, which in turn has increased difficulties for developers to invest overseas.”

Updated: January 6, 2019 02:49 PM

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