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Poor auction results not fault of system

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WHEN it comes to manipulating property prices, Hong Kong's big-time developers served up a telling reminder to the Government this week as to who really is the boss in this town.

By consorting in what to onlookers appeared to be a bid to keep land prices at the Government's auction this week low, the big guns of the property development world provided graphic evidence of their will and might.

Analysts saw it as a stinging shot to the Government not to do too much to interfere in free market forces with its current review of the property sector. The developers naturally denied this.

The message appears to be that if developers believe prices are rising dangerously high and need to pause for breath, they can handle the situation without a helping hand from Government.

Competition at land auctions has always been exceptionally fierce, with the taipans having only their own companies' profits in mind as they battle for development sites on the auction floor.

But because land sale prices have repeatedly broken records illustrates the strength of competition in the face of limited supply and the effectiveness of the existing Crown auction system.

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