A war of words has broken out between the government and the representative of major developers over new anti-speculation measures in the property market. Chief Executive Donald Tsang Yam-kuen said yesterday the new stamp duty was working. But Louis Loong Hon-biu, secretary general of the Real Estate Developers Association of Hong Kong (REDA), countered that genuine end-users could suffer 'collateral damage' from the new measures. 'We understand the government is trying to curb the speculation in the property market,' Loong said after meeting developers. 'We noticed there is speculation in the market. And the government has to tackle the problem. 'But we are concerned about the collateral damage that the measures may cause to people who are forced to sell their properties due to other, unforeseen circumstances.' He said the measures seemed to be proving effective for now as property sales fell this week. The new rules impose an extra 15 per cent on stamp duty for flats bought and sold within six months, 10 per cent for those sold between six months and a year of purchase and 5 per cent for those sold one to two years later. Speaking at the Boao Youth Forum at the Hong Kong Convention and Exhibition Centre, Tsang said the initial effect on the property market was to halt 'excessively malicious speculative activities' and to reduce the risk of a bubble forming. He said the measures were also designed to help genuine end-users and long-term investors. The Hong Kong Monetary Authority yesterday announced new mortgage loans drawn down in October fell 26 per cent to HK$25.1 billion compared with September. Approval of new loans fell 2.2 per cent to HK$30.8 billion. Property agents believe the fall in new mortgages was due to the cooling measures in August. Financial commentator David Webb criticised the new government measures as possibly breaching the Basic Law and creating unintended victims. 'Apart from catching short-term investors, the special stamp duty would catch homeowners who either wish to sell or are forced to sell for whatever reasons, such as the owner who loses her job and cannot pay the mortgage or get a mortgage to complete a home purchase,' he wrote on his website. He believed the stamp duty would not affect property prices, but would have a negative impact on liquidity. 'With reduced liquidity in the property market, there will be less work for estate agents, conveyancing lawyers and the related jobs in advertising that are linked to the volume of the secondary property market. Less work, fewer jobs.' Separately, Loong, of REDA, said the association had received the letter from the Transport and Housing Bureau regarding remarks made online by Cheung Kong Real Estate director William Kwok Tze-wai over the sale of the developer's new flats on the day the new stamp duty was announced. Kwok said the flat transactions would not be affected by the new measures. Loong said it had received the reply from Cheung Kong and REDA's supervisory committee would launch a hearing to decide whether a reprimand was warranted. 'Our committee members will study the case and reach a conclusion shortly,' he said.