Topic

Hong Kong stamp dutyi

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.

 

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Changes announced in the policy address relaxed some curbs on home sales for the first time in more than a decade. A close eye needs to be kept on the changes so that the market can recover without overheating.

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  • Simon Siu, chairman of Estate Agents Authority, says decision to scrap extra stamp duties last month was ‘shot in the arm’ for ailing property market
  • One estate agency says transactions in city’s 35 largest housing estates hit three figures for two weeks in a row after change, highest level in almost two years

‘China faces considerable domestic challenges, from a sluggish property market to weak consumer sentiment, Wharf says. After a poor result in 2023, more time is needed to revive the property markets, it says.

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Hong Kong’s largest developer by market capitalisation is being tipped by analysts to emerge as the ‘prime beneficiary’ of the city’s removal of all property cooling measures.

The removal of all property sector cooling curbs in Hong Kong has sparked immediate interest among mainland Chinese buyers, who still perceive real estate in the city as a lucrative investment option, industry insiders said.

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Immediate scrapping of property curbs, issuing of large amounts of bonds for infrastructure among measures unveiled in finance chief Paul Chan’s budget address.

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Secondary market transactions in Hong Kong flats jumped last week, as buyers took advantage of seven-year low prices, before a possible further relaxation of property cooling measures.

Insiders hint ‘only some measures might be lifted’ while analysts say they are sceptical that home prices will soar even if all cooling measures are removed.

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Hong Kong’s lived-in home prices fell for the ninth straight month in January, intensifying calls to roll back curbs on the sector even as the government is seeking to rein in a ballooning deficit estimated to exceed HK$100 billion (US$12.8 billion).

The worst is likely over for the luxury property segment globally, with prime home prices set to rise more than previously anticipated in 2024, according to Knight Frank’s Global Prime Residential Forecast.

Transactions for 2,767 new and lived-in homes were completed last month, a 22 per cent increase from October. But overall property deals are on track to end below the all-time low of 59,619 in 2022.

Hong Kong’s leader proposes raft of measures ranging from easing of property curbs, to offering handouts to promote childbirths and enacting security legislation.

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City leader John Lee is set to unveil plans to revive sluggish property market in policy address, which experts say can spur economy and lure foreign talent.

Measures to boost birth rate and improve city’s innovation hub status are also high on the agenda as Lee plots fixes for structural problems in economy, source says.

Company reports a 28 per cent decline in profit attributable to shareholders and cuts final dividend by 80 per cent to ‘retain cash and strength’, CEO Adrian Cheng says.

An improved economy, a better jobs outlook and a turnaround in stock market performance are also needed to boost homebuying confidence and sentiment in the city, they say.

Democratic Alliance for the Betterment and Progress of Hong Kong says stamp duty on purchases of additional homes should be cut from 15 per cent to 6 per cent.