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The real estate market has no conditions for withdrawal

2022-08-10T10:26:41.717Z


Ip Liu Shuyi recently proposed that the government may consider exempting "double stamp duty" for buyers of professional residential properties from the mainland, which has caused the community to misunderstand that this is the direction of the government's policy. At present, there are many risks in buying a property, no matter what Ye Liu said.


Ip Liu Shuyi recently proposed that the government may consider exempting "double stamp duty" for buyers of professional residential properties from the mainland, which has caused the community to misunderstand that this is the direction of the government's policy.

At present, there are many risks in buying a property. Whether it is the demand for mainland professionals mentioned by Ye Liu, or the trend of the property market falling from a high level, the government still has no conditions to "reduce the spicy" and relax the threshold for buying a property.


Since 2010, the government has successively introduced a number of measures to manage demand in the property market, including additional stamp duty to combat short-term speculation, a flat 15% buyer’s stamp duty for non-permanent resident companies and foreigners, and a buyer’s stamp duty for non-first-time buyers and buyers of properties in Hong Kong. A flat 15% ad valorem stamp duty on the home.

The background of the spicy move is that property prices continue to rise and there are short-term profit-making cases. Moreover, the property price will rise again soon after the government's move, and the government will continue to increase the heat.

A local academic study has reviewed the property market in recent years, which proves that the increase in mainland buyers is related to the upward trend in property prices.

Ye Liu hopes that the government will exempt people from the mainland who have been in Hong Kong for less than seven years from paying the last two types of 30% of the tax, and believes that this will help attract professionals and stimulate the property market.

This is about whether the government should distinguish between speculators and self-occupants within the mainland buyer group.

We are happy to see mainland talents choose to develop their careers in Hong Kong. It is understandable that they need long-term residence. Such self-occupation needs are different from speculation.

If they buy property early, it may consolidate their decision to stay in Hong Kong, but this is not enough to support the withdrawal.

The Convener of the Executive Council, Ip Lau Suk-yee, clarified that the "spicy reduction" proposal is only the opinion of the NDP and will be put forward during the consultation on the "Policy Address".

(Photo by Su Weiran)

Differentiate between speculators and owner-occupiers

In this regard, the government may consider setting up tax rebate measures for owner-occupier buyers who hold the goods for a long time. For example, if they have purchased a property in Hong Kong for three years, plus they have lived in Hong Kong for seven years and obtained local resident status, they will receive a full or partial refund of the spicy tax.

Compared with the direct waiver, the pay-first-back arrangement can avoid a short-term surge of buyers and stimulate the property market.

If the government rolls out this measure, the target can also be expanded to talents who come to work in Hong Kong from all places. At the same time, it is limited to individual buyers and does not accept property holding in the name of companies.

Although the economy is currently facing downside risks and factors that are unfavorable to the property market have emerged, since the property market has been relatively stable in the past few years, the government does not need to rush to take measures to reduce the hotness when the property price retraces by a few percentage points.

After the release of Ye Liu's interview clip, real estate stocks and property agency stocks were once danced and then fell back, which reflects that the outside world is quite sensitive to the property market policy, and the government's image of supporting the market is deeply rooted in the hearts of the people.

In addition, mainland buyers who are able to buy a property but are unwilling or unable to pay 30% of the tax can still rent the property, and the living problem is not that big.

Many grassroots in Hong Kong are unable to benefit from the rising property market, and even have to live in subdivided flats every month.

(File photo/Photo by Huang Shuhui)

The government has the responsibility to strictly control the risk of the property market

In addition, the tax has a considerable effect on stabilizing the property market. Some scholars have studied that from the implementation of the additional stamp duty to 2017, the owner of the property will extend the delivery period, effectively combating short-term speculation.

Taxes failed to depress property prices, and the scholars explained that the decrease in transactions led to a decrease in supply, which pushed up the prices of first- and second-hand properties.

Of course, this is also related to the fact that the government has not vigorously sought land to build houses, and has not been determined to introduce measures such as the vacancy tax on first-hand buildings, which has led the public to believe that the demand for housing will outstrip supply for a long time.

There are many powerful residential buyers. The government's three major spicy taxes have not prevented the rise in property prices, but at least they can prevent short-term speculation.

In addition, the property market affects the economy, and the government has the responsibility to strictly control the risks of the property market. Maintaining taxes, together with measures such as lowering the mortgage-to-value ratio and stress testing, will help reduce the number of people who are reluctant to get on the bus and avoid large-scale negative assets or supply cuts.

Times have changed, and the macro economy has turned pessimistic. The interest rate hike has particularly troubled the local property market. Property prices have fallen from the highs in the third quarter of last year.

However, if the government is in a hurry to reduce the price of the housing market, it will only make the property owners falsely expect the property market to only rise and not fall, and the government has the means to take into account the self-occupation needs of overseas talents through adjustment measures.

The government's housing policy should still meet the goal of local people's housing, and it is still necessary to limit the needs of non-local home buyers.

Only by reclaiming the golf course and building houses can reflect the value of the Li Jiachao government. The key to land sales and demarcation-the new government with development leadership must come up with a five-year plan as soon as possible

Source: hk1

All news articles on 2022-08-10

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