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Alex Lo

It has been a pretty grim hot summer with the jailing of young rioters and MTR construction fiascos, but a leading developer provided some light relief during an interview on TVB.
Stewart Leung Chi-kin, chairman of the Real Estate Developers Association’s executive committee, said the industry had not been hoarding flats.
A South China Morning Post reader reacted to this claim online with: “And pigs fly …”
Leung said developers should not be forced to sell all the flats in a project at once so as not to “flood the market”.
I don’t know about you but that sounds like hoarding.
What next after a vacancy tax on developers hoarding empty flats?
It is apparently not unusual for developers to continuously release a few flats in a project at a time, so selling all the units can take a long time. One example cited was The Long Beach in Tai Kok Tsui, built by Hang Lung Properties in 2005, which still has flats to sell.
Leung also said because land supply increased under the previous administration, it was natural there would be more unsold flats.


According to the Rating and Valuation Department, 42,942 flats, or 3.7 per cent, were vacant from last year. Of those, 9,370 were unsold new flats, of which 5,000 were completed last year.
The government may be serious about imposing a vacancy tax on empty flats, hence the alarm from the association, but officials have offered few details so far.
But it all looks like a “good cop (the government)/bad cop (the property industry)” routine.
Hong Kong's housing future may lie in learning lessons from Singapore’s past
The average price per square foot of saleable area has gone up almost 10 per cent in the past 12 months. Previous years were even crazier. A vacancy tax is only meaningful if it’s high enough to make hoarding unprofitable. Do you think the government is ready to make the tax hurt? We will see.


A moderate vacancy tax that makes no difference to developers’ bottom lines would actually be good public relations for them – and the government. They could say they are cooperating for the good of society. What’s next?
Hongkongers will feel the squeeze as mortgage rates gain momentum
The government has already proposed private-public partnerships (PPP) to develop farmland held by developers, often for decades. A compromise over a vacancy tax would put them in good stead with the government.
Normally, developers would have to pay huge land conversion premiums if they wanted to build on them. But with PPPs, much more lenient terms are not only possible, but likely.


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My Take

Hoarding denial by Hong Kong developers raises smile in hard times

The government's vacancy tax suggestion looks like a ‘good cop (the government)/bad cop (the property industry)’ routine. But the tax is only meaningful if it’s high enough to make hoarding unprofitable, says Alex Lo. Photo: Felix Wong

More land supply means more unsold flats, Hong Kong developers’ group says while denying homes are being hoarded

Hong Kong is consistently ranked the world’s least affordable property market. Photo: Martin Chan

Interview with Chairman of Executive Committee of The Real Estate Developers Association of Hong Kong, Mr. Stewart Leung Chi-kin at the World-Wide House in Central. 16MAY17 SCMP / Dickson Lee

What next after a vacancy tax on developers hoarding empty flats?

Former chief executive CY Leung has expressed regret at not sticking to his plan to tackle the city’s housing problem: Photo: Fung Chang

Norman Chan Tak-lam, Chief Executive of the Hong Kong Monetary Authority (HKMA), attends a press conference in Central. 29JAN18 SCMP / David Wong

Copying Singapore’s approach to flat sales could drive down cost of land and stop Hong Kong developers hoarding flats, say former government advisers

Pair suggest alternative to vacancy tax could be more effective in solving city’s housing crisis

New World Development won a residential site in Singapore, Cascades Road and North of Orchard Road (in the middle of the picture) Photo: Google

Hong Kong’s government is expected to announce a vacancy tax on empty properties later this month: Photo: Xiaomei Chen

Opinion

News

Hong Kong

Don’t be surprised if there is a compromise on a vacancy tax with the government, followed by favourable terms on the development of farmland


Hong Kong land sale

Hong Kong property

Hong Kong housing

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


Column

.css-1m2rp1p{color:#34b8b5;}My Take | Hoarding denial by Hong Kong developers raises smile in hard times

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Don’t be surprised if there is a compromise on a vacancy tax with the government, followed by favourable terms on the development of farmland

My Take | Hoarding denial by Hong Kong developers raises smile in hard times

Don’t be surprised if there is a compromise on a vacancy tax with the government, followed by favourable terms on the development of farmland