THE latest topic of debate in the property industry regarding the controversial mortgage ceiling is whether or not a bull run is possible when it is finally lifted. President of the Society of Hongkong Real Estate Agents, Mr Michael Choi Ngai-min, and Chung Sen Surveyors have warned that a bull run could be induced if the 70 per cent limit remains in place for much longer, causing speculation and forcing prices up. But Standard Chartered Bank's senior manager for property in the corporate banking division, Mr Graham Dodd, and managing director of estate agents Nihon Pacific, Mr Jeffrey Finney, said they felt the removal of the mortgage limit would not precipitate arush into the market. Chung Sen's managing director, Mr Michael Clarke, said the ceiling had had the desired effect of cooling the property market, but he warned that if the restriction remained in place for much longer, demand could build up to unacceptable levels. ''This could cause increased disregard by developers and financiers of the policy and generate a very active market once the ceiling is removed, probably inducing a bull run at least in the short term,'' he said. Mr Choi said the Society of Hongkong Real Estate Agents shared this view. ''People will speculate and prices will go up,'' he said. Standard Chartered is still committed to the 70 per cent limit. However, Mr Finney said he believed it was no longer helpful. Neither foresaw a bull run when the limit was lifted, although Mr Finney said it would increase the number of buyers coming into the market. Mr Finney said there had been a definite mood change in the residential market since Chinese New Year. He said the smart money was beginning to move back into the residential property market, while the ''sheep'' were waiting for positive indications such as a raising of the mortgage ceiling, or a breakthrough in Sino-British relations. Mr Finney said before Christmas it would have been difficult to find buyers, but they were now coming forward more readily. A number of property owners were holding back from putting their property up for sale in the hope of better prices when the mortgage ceiling was lifted. He warned this meant there was a poor range available, which was putting upward pressure on prices. Mr Dodd disagreed: ''If anything, when they do release properties on to the market, there would be more relative supply.'' In line with the lack of pre-Christmas buyers, Mr Clarke said official statistics showed a drop in sales and mortgage transactions, and that Chung Sen research indicated a levelling and slight decline in the average values paid. Mr Clarke and the Hongkong Society of Real Estate Agents have called for a restructuring of the policy regarding homeowners, many of whom find it difficult to come up with the extra 30 per cent needed when buying a home. ''Clearly the heat has gone out of the market and this is beneficial for all concerned,'' Mr Clarke said. ''History has shown that runaway markets overheat and the resultant drop in values has adverse effects on developers, investors, financiers and purchasers. The problem now is that this decline should not be allowed to continue. ''There should be a structured increase in the ceiling, perhaps by five per cent increments each two or three months, allowing some time for the market to be monitored after each change,'' he said. To halt property speculation, the reason for the implementation of the restriction, they said investors should be subject to either a restricted mortgage ceiling or higher interest rates, or both, with penalty clauses for early repayment of the loan. Mr Finney also voted for a hike in the ceiling, and said the 18 to 20 per cent fall in property values had been good for the market but that the limit was no longer helpful. Mr Dodd said: ''The way I read it, the Government wants to avoid restricting the purchasing power of first time buyers but wants to restrain speculators. ''No one wants to see a return to the old, hectic days. If there was a relaxation of the limit it would not be for two or three months and it would probably only apply to first-time buyers.'' Mr Finney predicted a steady increase in transaction volume up to April/May. He said the Hongkong market tended to follow a clear pattern of growth followed by consolidation, followed by growth. ''Now at the start of a new year we're going to see a new level of interest coming,'' he said. ''People have had time to consolidate their savings.'' He said that people had money but were not going to sit on their savings, as they were aware that whatever the published official rate of inflation, the real rate was in double digits.