Donald Tsang

Finance chief vows to keep property market running smoothly

PUBLISHED : Monday, 23 November, 1998, 12:00am
UPDATED : Monday, 23 November, 1998, 12:00am

Speculation in the property market was to be expected and the Government would make adjustments if necessary to ensure it functioned smoothly, the Financial Secretary said yesterday.

He was commenting after speculators and buyers turned out in force on Saturday for the sale of a housing project in Tai Kok Tsui following Friday's announcement by the Association of Banks of a 0.25 per cent cut in interest rates.

More than 1,000 flat buyers snapped up 85 per cent of the 1,070 flats on pre-sale offer in Sino Land's Island Harbourview project.

Donald Tsang Yam-kuen said it was expected that speculation would occur within a free market.

The most important aspect was whether these activities distorted the market or not, he said.

Mr Tsang said the Government did not think the supply and demand of the market had been affected.

But the administration would bring in adjustments if needed.

He also said a resumption of land sales would be reviewed next year.

Mr Tsang said prospects for the property market depended on a number of factors including whether buyers had funds, and public and banks had confidence in the market, which would determine provision of loans.

Asked if the latest interest rate cut was too little, Mr Tsang said banks did not lack funds but were concerned about any possibility of bad debt.

'Their confidence lies in factors outside Hong Kong, for example the situation in Japan.'