Government's moves to check real estate speculation and prevent the housing bubble from bursting are working—but at the expense of already battered middle-class home owners.
Home owners might see their property values plunge by as much as 25% by 2013, over four times the rate of descent in June 2011. Home deals in December fell for a sixth straight month to the lowest since November 2008, as shown by Land Registry data.
Hong Kong's imposition of higher borrowing costs, higher transaction taxes and higher down-payment requirements are continuing to worsen the property price spiral.
“We’re in for a very challenging first half,” said Wong Leung-sing, associate director of research at Centaline Property Agency Ltd., the city’s biggest closely held realtor.
“The drop in secondary mortgages means buyers are having trouble borrowing from the banks the full amounts they need. The ones that are taking the biggest hits right now are the middle- to lower- priced housing segment.”
Financial Secretary John Tsang, however, said two days ago in his annual budget speech that Hong Kong will continue measures to maintain stable home prices.
Do you know more about this story? Contact us anonymously through this link.