Rent rises may lift rates 4pc

PUBLISHED : Sunday, 25 February, 2007, 12:00am
UPDATED : Sunday, 25 February, 2007, 12:00am
 

Private home owners are expected to pay 4 per cent more in rates in the next financial year because of rising rents.


Those who own large flats can expect to pay even more because the rental value of such properties has risen sharply over the past year.


However, the increase would be offset if rates are waived for a quarter. This is likely to be announced by Financial Secretary Henry Tang Ying-yen in his budget speech on Wednesday.


Currently, rates are charged at 5 per cent of the rateable value, which is the estimated annual rental value at a particular date.


A government source said the latest assessment of rental values of Hong Kong's 2.8 million residential and commercial properties was almost complete. He said results showed a general increase in rateable value, although he declined to provide detailed figures.


But the Rating and Valuation Department's rental index for private residential properties increased 4.2 per cent from 89.9 in October 2005 to 93.7 in October last year. Commercial offices saw a bigger rise -102.2 to 119, or 16.4 per cent. Retail properties increased from 102.7 to 106.2, or 3.4 per cent.


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