Government to boost land supplies to cool property prices when necessary

More than 90 percent of local residents think the city's home prices are already too high to afford, while nearly one third of the population believes that the rising trend of the prices are not likely to find a turning point in the coming year, a latest survey by the Chinese University of Hong Kong shows.

According to the university's Hong Kong Institute of Asia-Pacific Studies, which surveyed 774 adults in the city last week, 90.7 percent of the respondents said the current Hong Kong property prices are "exorbitant", compared with 5.8 percent and 0.4 percent who either find the prices "affordable" or "inexpensive".

However, only 10.6 percent of the respondents believe that home prices will decline from the current level, according to the survey, with 29.7 percent predicting a further price hike and 48.3 percent saying the prices will remain stable in the following year.

The housing issue is one of the biggest concerns among Hong Kong people. The result showed the public lacks confidence that the government has the ability and determination to alleviate or stabilize the excessively high property prices, researchers from the institute concluded in the survey.

In his election manifesto, the new Chief Executive Leung Chun-ying has vowed to introduce three major policies for the property sector, including "Hong Kong land for Hong Kong people" and accelerating the construction of public housing units, as well as the latest move which allows a certain number of non-public housing tenants to buy apartments under the Home Ownership Scheme (HOS) without having to pay the land premium.

The survey released on Tuesday found that all these measures have won over 50 percent public support, including more than 80 percent of the respondents in particular. They applauded the government's determination to build more public homes.

But Hong Kong people are still skeptical about the outcome of these measures. The survey showed that only 22.1 percent of the survey respondents believe that the "Hong Kong land for Hong Kong people" policy will be able to solve the city's housing issue for the middle class. About 24.2 percent of the respondents are optimistic that the HOS with land premium exemption will help eligible residents to purchase homes, while 32.3 percent hold a negative view.

Hong Kong Chief Secretary Carrie Lam said on Tuesday that the current property market in Hong Kong is "irrational". Property prices have risen so quickly that Lam herself can't afford to buy an apartment in the city, according to a local newspaper Sing Tao Daily.

The latest Centa-City Lending Index (CCL), which measures the local secondary residential property, has reached 107.18, far exceeding the previous highest record of 102.93 in October 1997, Centaline Property Agency said on Friday.

Lam indicated that the new government attaches great importance to the overheating problems in the Hong Kong property market and will consistently increase land supplies to cool the prices.

litao@chinadailyhk.com

(HK Edition 08/30/2012 page2)