HKMA’s tight mortgage policies are misguided and miss the point on home ownership

I refer to the report on the Hong Kong Monetary Authority chief rejecting lawmakers’ calls to relax mortgage policies, citing the overheated market (“Hong Kong Monetary Authority chief Norman Chan rejects calls to relax mortgage policies”, February 5).

The HKMA is terribly misguided in their restrictive mortgage policies. The ultimate goal of cooling down housing prices is to increase affordability and, as a result, home ownership in Hong Kong.

However, the HKMA seemingly doesn’t really care about actual home ownership and is happy to see lower housing prices, even if fewer people have the financial resources to buy property in Hong Kong.

One side effect of the restrictive mortgage policies is that people flock to the primary market, because developers are increasingly offering top-up mortgages to reduce the required down payment. Since for many people this is the only way to afford a decent flat, they become price-takers, and developers can get away with charging whatever they want for newly released units.

On second thought, is this the side effect or actually the intended effect all along? Call me cynical but I really can’t be sure.

I also fail to see the rationale behind requiring a higher percentage of down payment for properties of higher value.

Why should someone be unfairly disadvantaged just because they earn a higher salary and want to live in a more decent home? I can understand if the HKMA wants to discourage and disadvantage buyers who already own property, but for first-time buyers, everyone should be able to buy the home they want if their earnings can comfortably cover mortgage payments.

Lastly, let’s even give HKMA the benefit of the doubt and say these restrictive mortgage policies do help keep property prices in check. But who’s benefiting from this? Certainly not wage earners who no longer have enough savings to buy property.

But if you are an overseas speculator who buys with all cash anyway, it’s not a bad situation, is it?

Shushu Gao, Kowloon