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  • Sep 20, 2014
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15 per cent stamp duty

To rein in the city's runaway housing prices, Hong Kong's Financial Secretary John Tsang Chun-wah announced an additional 15 per cent stamp duty on non-permanent-resident and corporate buyers starting from October 27, 2012. The move prompted speculation over the effectiveness of taxation on the real estate market and criticisms that Hong Kong was turning away from its roots as a free market economy in favour of a more protectionist market environment.

 

NewsHong Kong
POLITICS

Franklin Lam 'rejected offer HK$1m higher for flat'

Property agent's claim comes as Exco man gives a new version of dealings that led to sale of home before new cooling measures kicked in

PUBLISHED : Friday, 02 November, 2012, 12:00am
UPDATED : Friday, 02 November, 2012, 3:13am

Executive councillor Franklin Lam Fan-keung rejected an offer that was about HK$1 million higher than the price he finally accepted for one of his Mid-Levels flats, a property agent who approached Lam told the South China Morning Post.

Meanwhile, Lam gave a new version of his dealings with another agent who sold the flat. Earlier, he said he told the agent he could pocket the difference between the asking price and the price paid for the Casa Bella flat 14B.

Lam said the Centaline agent rejected his offer and suggested the money be given to charity.

Lam said he agreed and planned to donate the difference to the Centaline Charity Fund, set up by Centaline's founder, Shih Wing-ching.

Lam put two Mid-Levels flats up for sale just weeks before the government introduced measures to curb property prices.

He denies knowing such measures were imminent, but the Democratic Party has filed a complaint with the Independent Commission Against Corruption.

Centaline Property Agency said yesterday it would not accept Lam's donation.

A property agent who requested anonymity said several offers were made for flat 14B, the last one of about HK$11 million in early September. Lam sold the flat for HK$9.95 million on September 20. On September 14 secretary for Housing and Transport Anthony Cheung Bing-leung announced the government could bring in more initiatives after the Hong Kong Monetary Authority announced new mortgage tightening measures the day before.

On Friday the government introduced a stamp duty of 15 per cent on non-permanent-resident and corporate buyers. It also raised and extended special stamp duty payable on resales.

Lam said in a statement last night he had donated "excess proceeds" of HK$70,000 arising from the sale of flat 14B to a charity for environmental protection. He said earlier he turned down some offers because they included conditions, such as a completion period of 10 months. He did not disclose the size of the offers.

Ricky Poon, executive director of residential sales at property agency Colliers International, said it was rare for a buyer to ask for such a long transaction period when buying a second-hand flat since the government imposed the special stamp duty in November 2010. Until last Friday, this meant buyers had to pay a levy if they sold the flat within two years. The levies are now payable on resales within three years.

Lam said on a radio show yesterday he offered to let the Centaline agent pocket the difference between the price he asked for and the actual price flat 14B sold for to encourage the agent.

"But the agent suggested the money should be donated to charity," Lam said. He and his wife then decided to donate the HK$70,000 difference to the Centaline Charity Fund.

He said he set his asking price for the flat about 2 to 3 per cent lower than the market price, which was HK$9.88 million.

Lam said he did not write in the contract with the buyer that the difference between his asking price and the selling price would go to his agent or any charity.

He was speaking after Democratic Party chief executive Lam Cheuk-ting made a complaint to the ICAC on Wednesday.

The former ICAC investigator said Lam could have violated the Prevention of Bribery Ordinance if he did not let the buyer of flat 14B know that part of the money would go to an agent.

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