Hong Kong’s leader on Wednesday outlined new steps to cool the world’s hottest property market, including a halt to automatic residency for rich buyers, in the face of simmering public anger.
The residency measure will particularly hit wealthy investors from mainland China, whose buying spree in high-end apartments has done much to stoke fears of a new bubble in the Hong Kong economy.
Chief Executive Donald Tsang said he was responding to public anxiety about a residential housing shortage and rocketing prices, during a legislative assembly session during which one lawmaker stormed out of the chamber.
Some 200 protestors shouted slogans and waved placards outside the Legislative Council, demanding more public housing and decrying the control of private property developers over the market in land-starved Hong Kong.
Before storming out, lawmaker “Long Hair” Leung Kwok-hung threw a polystyrene clock at Tsang, arguing that time was running out for elderly people forced to live on meagre savings in the absence of state pensions.
Noting that property prices have risen 20 per cent in the past year, Tsang said in his annual policy address: “Housing is currently the greatest concern of our people.
“Over the past few years, private housing supply has been relatively low. We should address the fundamentals by increasing land supply in response to market demand.”
Tsang announced plans to build residential property on the city’s old airport, Kai Tak, which was closed down in 1998. The prime harbour site remains undeveloped as the government cleans up heavy aviation pollution.
He also said the government would consult the public on proposals to reclaim land elsewhere than the crowded Victoria Harbour, which has steadily diminished down the years due to property development, angering environmentalists.
Tsang said the government would adopt a temporary amendment to Hong Kong’s Capital Investment Scheme, preventing investors from gaining residency in the territory through property purchases from October 14.
Mainland investors have long been lured by the prospect of residency in Hong Kong, a financial centre and gateway to China that is run under a different legal system and boasts higher living standards.
The speech sent share prices in major property developers plunging before the sector recovered much of its lost ground. SHK Properties finished down 0.59 per cent and Sino Land fell 0.12 per cent.
Simon Smith, head of research at consultancy Savills Valuation and Professional Services, said the measures would have a limited impact.
“The new policy measures are fairly conservative,” he told AFP.
“I think the effect will be modest. It is the government’s intention to gently head off the bubble, it is not easy to do. In this global environment, the government is anxious not to tip over the market.”
Property prices in Hong Kong have surged nearly 45 per cent from their trough at the end of 2008, while prices of some luxury flats have returned to, or surpassed, the peaks of the 1997 boom.
Public anger was on display outside as Tsang spoke inside the British colonial-era Legislative Council.
“With property prices soaring to new heights, the poorer sections of society have no hope of buying their own apartment,” protestor Penny Keung told AFP.
“The government should help alleviate conditions for the poor instead of catering to the interests of big businesses,” she said.
In August, the government said it would further increase land supply and tighten mortgage lending to avert a property bubble. While that dented the volume of property transactions, prime land still goes for giddy amounts.
On Tuesday, demonstrators interrupted an auction of an upmarket residential site in the Kowloon area that fetched a record 1.63 billion Hong Kong dollars (210 million US).
Source : Channel NewsAsia – 13 Oct 2010
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HK’s property cooling measures may attract more mainland Chinese investors to S’pore
The latest property cooling measures in Hong Kong may prompt more mainland Chinese buyers to turn to Singapore as a destination for property investments.
Market experts said this may in turn cause property prices here to escalate higher and it could even spur another round of cooling measures.
Colin Tan, who is Head of Research & Consultancy at Chesterton Suntec International, said: “Every time cooling measures are applied in China and in Hong Kong, we can expect Chinese property investors to redouble their efforts in their search for alternative places to invest, and Singapore continues to climb up higher on their list.”
Experts said Chinese buyers formed about 16.4 per cent of foreigners that bought Singapore properties this year, with a total value of around S$1.4 billion.
Meanwhile, Executive Director of Residential Services at Credo Real Estate, Liang Thow Ming, said that Hong Kong’s tightening efforts could also have a psychological impact on buying sentiments in Singapore.
This may be in the form of heightened fears of additional cooling measures introduced in Singapore’s property market.
Still, most analysts believe that the overall impact of the measures will be limited as not many Singaporeans invest in the Hong Kong property market.
Donald Han, who is managing director at Cushman and Wakefield, said that “Hong Kong is not a hot-bed for Singaporean investors”.
Mr Han added that traditional Singaporean investors tend to go for property markets such as Australia and the United Kingdom, where property cycle movements are less drastic.
Measures outlined by Hong Kong Chief Executive Donald Tsang on Wednesday include a halt to automatic residency for wealthy Chinese buyers, effectively preventing investors from gaining residency in Hong Kong through property purchases.
This will be effective from Thursday.
Mr Tsang was responding to public concerns in Hong Kong about a housing shortage and property prices spiralling out of control.
Average home prices in Hong Kong have climbed by 15 per cent so far this year.
Source : Channel NewsAsia – 13 Oct 2010
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HONG KONG - Hong Kong has seen a surge in mainland Chinese buying luxury homes in the territory, according to a survey published as the authorities move to limit inward property investment. Mainland investors have long been lured by the prospect of residency in the former British colony, a financial centre and gateway to China that is run under a different legal system and boasts higher living standards. Influxes of mainland investment have contributed to a 20 percent rise in residential property prices in the last year, city chief Donald Tsang acknowledged on Wednesday as he announced measures aimed at cooling the market and alleviating public concern. In a new report, real estate agency Centaline estimated that for the first half of this year 35.1 percent of new home sales worth over 12 million Hong Kong dollars (1.5 million US) had been to mainland buyers, up from 22.5 percent in the second half of 2009. The agency, which publishes regular property market surveys, acknowledged that mainland investment might now be constrained by a move announced by Tsang that will suspend granting residency to outsiders who invest in property. "Some mainland buyers will inevitably be put off by the changes to the scheme announced yesterday. After all, buying property is a key way to gaining residency here," said Centaline's managing director for residential sales, Louis Chan. He predicted a five percent drop in the number of mainlanders purchasing high-end property. However any expectations of a more dramatic drop in mainland Chinese coming to invest in Hong Kong's property market might be misplaced. Wong Leung-sing, a fellow researcher at Centaline, noted there had been no move to limit the issuing of residency rights for those making other kinds of large investment. "Mainland investors still have a lot of ways of gaining residency in Hong Kong," said Wong. "They can invest in the stock market for example.... I foresee the luxury property market remaining strong." Property prices in Hong Kong have surged nearly 45 percent from their
trough at the end of 2008, while prices of some luxury flats have
returned to, or surpassed, the peaks of the 1997 boom. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
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