Following HK vote, local estate agents say further property cooling measures not needed

2014-2-24

From：Macau Daily Times

The Legislative Council (LegCo) of Hong Kong passed property
cooling measures into law on Saturday. The Stamp Duty (amendment) bill was introduced to help curb property speculation. After days of heated debate, the vote was controversial, with the pan-democrats staging a walkout because they oppose a negative vetting mechanism that, according to them, ruins the relationship between the legislative and executive branches.
The law enforces the higher stamp duties introduced by the Hong Kong government in late 2012 and introduces the possibility of rate adjustments. The Macau government has also adopted cooling measures, but housing prices here have not adjusted as substantially as in Hong Kong. Jeff Wong, Director and Head of Residential of Jones Lang LaSalle, told the Times that although the higher stamp duties did deter some housing speculators, he believes that the government has to increase the supply of housing units in order to lower the prices.
“I think that the Macau government has done a lot in terms of regulating the housing market. If you look at Hong Kong, you can see that we are following them pretty closely, such as by adopting Special Stamp Duty and Buyer’s Stamp Duty. The only measure that Macau did not introduce is the Double Stamp Duty. Although these measures that aim to manage the demand are effective to some extend, the result is not very apparent when you look at the whole picture of the market,” Jeff Wong said. He continued to point out that even though housing prices are not rising as significantly as before, he did not see the possibility of prices falling.
The director argued that the reason the housing market in Macau is not experiencing a downward adjustment is the lack of supply: “You can see there are adjustments in the Hong Kong real estate market. The higher stamp duties are, for sure, parts of the cause… But the Hong Kong government is also working on providing more apartments to the market… including selling a lot of lands to developers and making the public housing system more transparent. I believe that it is the stamp duties and the [increase in] supply of public and private housing that led to the adjustment of the Hong Kong real-estate market.”
Mr Wong said that if Macau imposes more levies on the buyers, it would only twist the market further. “If there should be more policies, I think the administration should study the case of Hong Kong and work more on the supply of public and private housing… I did not see significant reforms in the Macau government’s measures of boosting housing supply. In contrast, you can see that Hong Kong has been working on the issue and I believe this is the difference between the two cities.”
Moreover, Jeff Wong has addressed some residents’ concerns that developers will only build high-end residential apartments if they are granted more land. He said that the reason there are so many expensive units is, again, because of supply shortage. As soon as more apartments are available on the market, developers will follow consumer demand and provide housing products that suit the majority of residents.
The Hong Kong LegCo’s approval of the higher stamp duties is the final step that turned the measures into law. Since the announcement of the regulations in October 2012, the Hong Kong government has collected more than HKD4 billion from levies. If Hong Kong lawmakers had refused to support the bill, the government would have had to return the money to the buyers. Anthony Cheung Bing-
leung, Hong Kong’s Secretary for Transport and Housing, had previously warned LegCo members that being unable to pass the bill might lead to a surge in housing prices and a volatile stock market. He has verbally promised, instead of writing it into the bill, that any future increase in stamp duty will be scrutinized by the legislature. This has caused controversy and led some lawmakers to leave the chamber in protest of the move.

Copyright@Macau Daily Times