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Following is a question by the Hon Albert Ho and a written reply by the Secretary for Transport and Housing, Ms Eva Cheng, in the Legislative Council today (June 29):
Question:
As property prices in Hong Kong continue to surge, there are voices in the community alleging that the mainlanders who came to Hong Kong to speculate have pushed up property prices, while some others demand that purchase of properties in Hong Kong by people outside Hong Kong, including mainlanders should be restricted. The Chief Executive has also stated that "Hong Kong cannot do business with its door shut", the issue of whether it is in breach of the international treaties to restrict the purchase of properties by mainlanders has to be examined, and such restriction will be considered only when the property market is faced with "a hopeless situation". In this connection, will the Government inform this Council:
(a) according to the authorities' information, of the situation of people outside Hong Kong purchasing properties in Hong Kong (including the number of mainlanders who had purchased properties in Hong Kong, and among them, the number of people who did not have to pay property tax because the properties were for self-occupation or not let out) in the past three years;
(b) whether it knows, among the mainlanders' purchase of properties in Hong Kong in the past three years, the number of cases in which mortgage loans were acquired via banks and what the loan-to-value ratios were, as well as the number of cases in which the prices of the properties were paid in one go without the need to apply for mortgage loans from banks; and
(c) whether it knows the measures taken by other places to restrict the purchase of local properties by people from abroad?
Reply:
President,
The Administration has never imposed restriction on any persons over the purchase or transfer of residential properties. The proposal for restricting the purchase of residential properties in Hong Kong by people outside Hong Kong, including Mainlanders, is a major policy change. When considering this proposal, we have to take into account its impact on the free movement of capital which is a factor of success to the Hong Kong economy, Hong Kong's status as an international financial centre, the long-term economic development of Hong Kong, market response and implementation problems. As Hong Kong is an externally-oriented economy, we have to be very careful about the possible consequence of imposing specific restriction on investments by people outside Hong Kong.
My reply to the three parts of the question is as follows:
(a) and (b) While the Land Registry has records on local property transactions, there is no breakdown on the number of transactions by people outside Hong Kong or Mainlanders, or information on the purpose of their flat purchase.
The Hong Kong Monetary Authority does not collect data on the source of financing of flat purchasers in Hong Kong (including people outside Hong Kong and Mainlanders), such as the number of cases requiring mortgage loans from banks and the particulars of the loans, and the number of cases not requiring mortgage loans from banks.
(c) We understand that various countries and places have imposed restrictions on the purchase of residential properties by non-local residents. For example, some Mainland cities permit eligible foreign non-residents and residents from Hong Kong, Macao and Taiwan to purchase one residential property only. Singapore does not permit non-local residents to purchase "houses". In Australia, foreign non-residents are not allowed to purchase second-hand flats (but they are allowed to purchase uncompleted flats, and completed first-hand flats which have been left unsold for 12 months or more after completion). Temporary residents and overseas students have to obtain approval if they wish to purchase a flat, and must sell the flat within two years after their departure from Australia. The above examples show that the measures are different from one another, and do not impose an outright ban on foreigners on the purchase of residential properties. Also, those measures have taken into account the actual situation of those places, and cannot be simply copied to other places for implementation.
Ends/Wednesday, June 29, 2011
Issued at HKT 14:38
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