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A Government spokesman welcomes the Premium Loan Guarantee Scheme launched today (September 13) by the Hong Kong Mortgage Corporation (HKMC).
The Subsidised Housing Committee (SHC) of the Hong Kong Housing Authority (HA) discussed possible measures for revitalising the Home Ownership Scheme (HOS) Secondary Market in May this year. One of the proposals was the introduction of a premium loan guarantee scheme by the HKMC to facilitate HOS owners to settle the premium loan to the HA by instalments. The proposal was further discussed during the SHC meeting in July.
Under the Scheme, HKMC will provide a guarantee arrangement so that the banks can in turn facilitate a "premium loan" for HOS owners who wish to settle their premium payment. Once the HOS owners obtain the loan and pay the premium to the HA, their flats will be freed from alienation restrictions. The owners can then settle the premium loan by instalments.
The spokesman said, "The objective of the Scheme is to provide HOS owners with an alternative option without spurring property prices. We anticipate that HOS owners who may wish to pay the premium ahead of disposal of flats will benefit from the Scheme.
"There are households who may have purchased another property and wish to let their HOS flats for rental income, instead of leaving the flats vacant. An alternative option for financing their premium payment through instalment using the rental income for this purpose may better suit their needs,กจ he said.
Subsidised flats provide a major source of small to medium-sized homes at affordable prices. At present there are more than 320 000 HOS flats. Over 65 000 are flats with premium paid and 255 000 or so are flats with premium not yet paid. The former can be put up for sale in the open market readily; the latter can be sold in the HOS Secondary Market and, upon payment of premium may also be sold on the open market.
Since 70% of these HOS flats are located in urban and extended urban areas, facilitating the turnover of these flats may cater for the low-end property market.
Other means to revitalise the HOS Secondary Market include streamlining the related administrative arrangements and enhancing publicity, as well as extending the HA's mortgage guarantee period. The former measure is being implemented by phases while the latter will be discussed by the HA in due course.
Ends/Monday, September 13, 2010
Issued at HKT 19:36
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