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. And, with the Government's traditional laissez faire approach to business, developers have always played ball. But now that Governor Chris Patten is threatening to intervene in the property market and change the goal posts, it appears developers may be warning the Government it may not be able to always rely on their support. After 12 developers teamed up to buy one plot auctioned off this week and 14 got together to buy another, at what were seen as bargain prices, Secretary for Planning, Environment and Lands Tony Eason said he intended to review the whole auction process. It would be wrong to abandon this tried and tested way of disposing of Crown land after just one slip. It seems that what occurred at Thursday's auction should be treated as unusual and not the fault of the auctioning process itself.
