Caution required on help to buy Hong Kong homes
As flat prices climb, the government would be wise to think twice about offering mortgage assistance to those aiming to get on the housing ladder
The city’s red-hot property market shows no sign of slowing. The new year’s first property launch got off to a roaring start, as Sun Hung Kai Properties sold all 118 flats at its St Barths complex in Ma On Shan in just one day. This was followed by a second sell-out of another batch of 108 units a week later.
Market conditions today are especially worrying for aspiring first-time buyers and those without solid financing. Would-be buyers may be tempted to chase the market as they fret that prices will only become more unaffordable if they don’t take the plunge now.
But those who incur heavy debt in the form of a mortgage will also be the most exposed when the market experiences a correction. That is why the government must think carefully before launching any scheme to help first-time buyers to get on the path to becoming a homeowner.
Speaking on the sidelines of an international financial forum this week, James Lau, the secretary for financial services and the treasury, said it should be the right of every citizen to own their own home.
Luckily, he tempered that statement by saying any plan by the government to help young people and other first-time buyers to get on the ownership ladder must be thought through carefully.
