Lands chief blames public for high property prices
The Hong Kong public, rather than speculators or the Government's high land value policy, is responsible for driving property prices in the territory higher, according to the Director of Lands.
Speaking at an American Chamber of Commerce property seminar yesterday, Bob Pope said: 'At the end of the day, the public determines the price. It's not the Government and it's not developers.' He said people's decisions on flat-buying were determined by whether they had enough money, whether their prospects were good or the level of interest rates.
These were the real factors controlling price movements, he said.
Part of the reason for the upsurge in flat prices was due to the lack of land sold at auction back in 1992 and 1993, he said.
'This was not because of my department's desire to create a shortage of supply but because demand for the land was very low,' he said.
During 1994-1995, he said the Government withdrew nine lots from sale at auction because they did not receive opening bids.
According to Government figures, about 20,000 private flats per year have been built in Hong Kong in the last two years, with a similar number projected for 1997.
The provisional forecast for next year is about 36,000 flats, with supply increasing steadily between 1991 and 2001.
According to Mr Pope, prices will not continue to spiral upward in the future.
'There will come a time when prices will consolidate and that will last for a few years,' he said.
Mr Pope said the Government would soon be releasing some of the 70 hectares for development announced by the Secretary for Planning, Environment and Lands, Bowen Leung Po-wing.
'The 70 hectares is not just something that he dreamed up out of his head,' Mr Pope said.