Opinion | Investors viewed unfairly as speculators

Why did the Hong Kong government assume that all investors in the city's commercial properties were speculators, when the sector overheated early this year?

This question has clearly confused many foreign investors, prompting several chambers of commerce representing hundreds of firms to voice their unhappiness about the government's sweeping anti-speculation measure in February.

Their message was simple but loud and clear, as reported by the South China Morning Post on Friday: their member firms are long-term investors, not speculators. This is precisely the reason they bought the office premises they had been using in Hong Kong - because they did not want to be subjected to the roller-coaster ride in the city's property market.

That the government failed to recognise this long-standing phenomenon has understandably upset and bothered these foreign investors, prompting them to ask their respective trade chambers to speak up on their behalf.

After a 15 per cent buyer's stamp duty for non-permanent residents and corporate buyers was imposed in the residential market in October last year, speculators quickly shifted to the commercial property sector, pushing up prices of car parking spaces, offices, hotel rooms and industrial units.

The government's February 22 announcement of a doubling of stamp duty on residential and commercial property sales exceeding HK$2 million in value was designed to curb speculation. In the top bracket - on sales worth more than HK$20 million - stamp duty rose to 8.5 per cent of the property's value, from 4.25 per cent.