Two Kai Tak sites chosen for HK-only buyers in pilot property scheme

Pilot scheme will involve two pockets of land at old airport, with property sales limited to city's permanent residents for a period of 30 years

PUBLISHED : Friday, 07 September, 2012, 12:00am
UPDATED : Monday, 10 September, 2012, 11:33am

Two sites at the former Kai Tak airport have been selected for a pilot scheme in which homes will be sold only to Hong Kong permanent residents for 30 years.

Chief Executive Leung Chun-ying said yesterday the "Hong Kong property for Hong Kong residents" policy was finalised.

He was speaking a day after cancelling his trip to the Apec meeting in Russia to deal with the controversies over national education and housing policy,

He said: "The main reason for this is to put priority into satisfying the housing needs of those who see Hong Kong as their home, with our scarce land resources. Our legal advice is that the idea is implementable."

The government will sell the sites, originally placed on the land sale list, by tender between January and March next year.

The land leases will be written to specify that during the 30-year period, flats can be sold only to buyers with permanent residency in Hong Kong.

Companies are ruled out and the resale of those homes will also be confined to locals.

Leung said he did not want to impose too many restrictions, such as on the buyer's economic status, whether he or she is a first-time buyer and whether the home is for the owner to live in.

Secretary for Transport and Housing, Professor Anthony Cheung Bing-leung, said he did not think the policy would affect the city's free economy status.

He said Singapore and Australia, also rated as free economies, had similar measures. Asked if the policy would be implemented more widely, Secretary for Development Paul Chan Mo-po said: "We will continue to consider executing the policy in future land sale programmes."

The property sector expects the two sites will be sold for HK$3.72 billion to HK$7.05 billion in total, 10 to 40 per cent lower than the price would be without the policy in place. But experts said it was hard to tell if the flats would be cheaper.

The flats are due to be completed in 31/2 years, but it is up to the developers to decide when they want to sell the flats.

Donald Choi Wun-hing, managing director at Nan Fung Development, said more restrictions imposed on a site would reduce development flexibility and affect bidding interest.

But Donald Cheung Ping-keung, of the development company of Emperor International Holdings, believed developers would not be deterred from bidding on the two sites because of their prime locations.

The announcement came as property prices hit an all-time high, although demand by mainland investors for new homes worth less than HK$12 million dropped to 21.6 per cent in the second quarter from the peak of 35.5 per cent last year, according to Centaline Property Agency.

But the agency believed that mainland investors would return to the market for large-scale new projects being launched soon.