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Property News Weekly Digest
2018/6/30
〈Asian Post, June 30, 2018〉Subsidised flats will be nearly 50 per cent cheaper for young couples and middle-class families as part of a basket of measures Chief Executive Carrie Lam Cheng Yuet-ngor announced yesterday in a bid to ease Hong Kong's housing crisis by providing more affordable homes.

"Hong Kong people can be more reassured now; they don't need to be bothered by the price increase of private flats," Lam said, flanked by Financial Secretary Paul Chan Mo-po, housing minister Frank Chan Fan and development chief Michael Wong Wai-lun.

"There is no political motive," Lam said in relation to the announcement coming a day before she marks her first year in office as the city's leader. "It's just because housing in Hong Kong is the most important, most complicated and most serious problem."

Reforming the pricing system for subsidised flats was one of six measures Lam announced that would benefit young couples and families struggling to buy homes.

Other proposals included imposing a vacancy tax equivalent to two years of rental income on empty new flats, reallocating more land originally earmarked for private housing to build public flats, inviting the Urban Renewal Authority to build starter homes at Ma Tau Wai, imposing more stringent conditions on developers' sales of uncompleted flats, and forming a task force to drive temporary housing projects launched by community groups.

Hours before the announcement, the latest government figures showed home prices in May climbing to record levels for the 26th straight month, although at a slower rate.

"I don't expect society to measure the effectiveness of this package by the trend of Hong Kong private residential prices," Lam said. "But of course I hope that we will not be seeing another upsurge in property prices, because that is really making private housing very unaffordable for the people of Hong Kong."Sweeping changes to Hong Kong's subsidised housing policy set to be proposedPaul Chan would not rule out other measures such as considering a capital-gains tax.

〈Asian Post, June 30, 2018〉As more people are forced to live in smaller homes, a line of businesses has quickly popped up to serve their daily needs - from upscale laundromats to meal suppliers

As John Luo walks into a self-service laundry store in the fading daylight at about 8pm, he hauls in two canvas bags and a bulging backpack.

It takes him a while to empty everything. Clothes and towels tumble out, then he starts the one washing machine that can barely hold all his laundry.

"I come here every one or two weeks because I don't have a washing machine at home," says Luo, 33, who lives in a 110 sq ft nano flat with his wife. "There's simply not enough space for such a large appliance."

As property prices continue to soar and homes keep shrinking, a new sector is emerging to capitalise on the market.

Targeting nano flat residents whose homes are too small to install washing machines, cooking appliances, wardrobes, drawers, televisions and other features that make a typical home, creative service providers are stepping in.

Their enterprising ranks include storage locker proprietors offering a homey meal with traditional Chinese soup, as well as those who run 24-hour laundromats equipped with air conditioners, vending machines, free Wi-fi, and comfortable seats for customers to use.

〈The Standard, June 30, 2018〉An association that represents the city's major developers blasted the vacancy tax introduced yesterday as "unreasonable" and "unfair", urging the government to grant a grace period for flats that had been put on the market but failed to find buyers immediately.

"The government should allow developers more time to sell stocks of flats, especially large flats that could not be sold in a short period of time," said Stewart Leung Chi-kin, who chairs the executive committee of the Real Estate Developers Association (REDA).

Chief Executive Carrie Lam Cheng Yuet-ngor yesterday announced the vacancy tax for newly built flats that remained unsold.

The tax applies to all newly completed flats that are vacant for six months in a year. Flats are considered "completed" a year after obtaining an occupation permit.

The proposed tax would be equivalent to two years of rental income, calculated by government specialists and based on market rates.

Analysts said the tax rate was equivalent to 4 per cent to 5 per cent of the value of the vacant property. The proposed tax needs Legislative Council approval before implementation.

Lam said the aim of the tax was to release more flats and prevent developers from hoarding newly built units, instead of suppressing home prices. The prices of pre-owned homes in Hong Kong rose for a 26th straight month as of May, making it the least affordable property market in the world.

However, Leung said there was no merit to claims that property developers were hoarding completed units.

〈China Daily, June 29, 2018〉A two-part special begins today to mark the chief executive's first year in office - one in which there was no 'great reconciliation'on the political front

Before she was selected for office, Carrie Lam Cheng Yuet-ngor suffered the ignominy of being called CY 2.0.

As chief secretary to chief executive Leung Chun-ying she was seen as a dyed-in-the-wool bureaucrat who could continue the policies of her unpopular boss.

One year on, few remember that label. Thanks to a deft change in style and substance, Hong Kong's fourth chief executive has survived her first year in office with ratings higher than her former boss.

The city is less restive politically. Thorny issues and actors such as the pro-independence forces have been sidelined and all talk of electoral reform put on hold. The economy is experiencing its lowest rate of unemployment and is on track to achieve 3 to 4 per cent growth this year.

Lam cannot take all the credit, her critics will say. There has been no "great reconciliation" between the pro-Beijing and pro-democracy camps as her team had earlier touted.

Deep mistrust of the central government remains among sections of society. Hong Kong's inability to focus on reforming the economy remains a key worry and rising housing prices are a chief grouse.

Yet, even her critics will say the rancour of the CY years has subsided and more people are turning to the economy - with even the pan-democrats interested in finding out about the "Greater Bay Area" economic plans for instance - rather than remaining stuck on political positions.

〈The Standard, June 28, 2018〉Vacancy tax, pricing policy for subsidised flats and six prime sites for building affordable homes to be unveiled by government today, sources say

Flat-hoarding developers are set to face an annual vacancy tax amounting to double a property's annual rental income, after Hong Kong's top advisory body yesterday endorsed a basket of new measures aimed at easing the housing crisis.

At a special meeting chaired by Chief Executive Carrie Lam Cheng Yuet-ngor, the Executive Council approved proposals that included: introducing a vacancy tax on newly built flats remaining unsold; unlinking the pricing of government-subsidised housing from private market rates; and building affordable housing on at least six prime sites originally reserved for private developers to construct luxury homes.

With the government set to reject developers' concerns about the vacancy tax, the property gauge on the benchmark Hang Seng Index yesterday fell by as much as 1.3 per cent in an otherwise rising stock market, before recovering slightly to close 0.4 per cent lower.

Details of the proposed policy changes will be announced today even as property prices continue to soar - for 25 straight months as of the end of April - feeding public anger in the world's least affordable market to buy a home.