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  • Jul 12, 2014
  • Updated: 10:01am
NewsHong Kong
PROPERTY

Critics find holes in Hong Kong homes scheme

But officials reject claims non-locals will be able to find ways to buy flats meant for Hongkongers

PUBLISHED : Thursday, 21 March, 2013, 12:00am
UPDATED : Thursday, 21 March, 2013, 4:39am

The government fended off criticism yesterday of apparent loopholes in the tender terms for the first two housing sites in the "Hong Kong Property for Hong Kong People" scheme that could allow non-locals to buy the flats.

On Tuesday, the Lands Department announced two sites in Kai Tak will be up for tender under the scheme, which requires homes built on them to be sold only to Hongkongers. Surveyors said the terms of the scheme did not prohibit a non-permanent resident from buying a flat through a trust or authorising a permanent resident to buy one as a proxy. There was also concern that buyers of second-hand homes are not required to make a statutory declaration of their status as Hong Kong permanent residents.

But the Lands Department announced yesterday that every buyer of a flat under the scheme within 30 years must obtain the consent of the director of the department.

One of the conditions for gaining consent is that the buyer must make a statutory declaration of permanent resident status. The declaration has to be registered in the Land Registry.

Also, the buyer must buy the flat in his or her own name.

Any buyer who attempted to breach the regulations might be prosecuted under the Crimes Ordinance and could be fined and jailed for up to two years.

The government could also confiscate the flat.

Chief Executive Leung Chun-ying said yesterday in Beijing he was confident that the terms of the tender document set out by the Development Bureau would enable the scheme to meet the government's purpose - which is to help permanent residents become homeowners.

Lawmaker James To Kun-sun, a solicitor, said the scheme could keep some mainlanders out of the market.

The terms of the leases have increased the investment risk of mainlanders who want to buy the flats
Lawmaker James To Kun-sun

"The terms of the leases have increased the investment risk of mainlanders who want to buy the flats," To said.

"But some mainlanders might still be willing to take the risk and appoint Hong Kong residents to buy the flats [illegally] for them."

It would be a private agreement between two parties and difficult to uncover, he said.

Abraham Razack, the legislator for the property and construction sector, is concerned about the effectiveness of the scheme in achieving its purpose.

"The government is trying to control housing demand with this scheme, as it failed to control the housing supply. But this is not the way to control demand," he said. The two residential sites in Kai Tak will be put up for tender on March 28, and tendering will close on May 31.

 

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This article is now closed to comments

HK-Explorer
I don't get it. if a mainlander gives the money to a Hong Kong resident and the Hong Kong resident buys the flat and registers it under his name then there is nothing wrong with that. All the policy is to do is that Hong Kong people buy the flats. this reduces substantially investors.
the mainlander is also taking on massive risk by using a HK resident to buy the flat so I do not believe it will occur.
Ex: If the mainlander uses someone who is married to buy the flat and that person gets divorced the wife can take 1/2 the flat. If that person dies the flat will go to their next of kin (not the person who paid). If the HK resident becomes bankrupt he will be forced to sell the flat to pay back debts.
There are tons of reason why this is a non issue.
 
 
 
 
 

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