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Property-curb comments prove Tsang's lost the plot

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John Tsang Chun-wah is trying to talk up Hong Kong's property market.

In an interview in South Africa this week, the financial secretary said Hong Kong's government was preparing to relax its restrictions on home purchases in response to softening prices.

This is mighty curious, and not just because it's only two weeks since Tsang was warning about the risk of a property bubble.

It's curious because it betrays some seriously muddled thinking over in the financial secretary's office.

The curbs Tsang is talking about consist largely of limits on maximum loan-to-value ratios imposed on mortgage borrowers by the Hong Kong Monetary Authority.

For example, in the latest round of measures announced in June, buyers of high-end properties were told they would have to put up a down-payment of at least 40 per cent of the home's value.

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