4 big property issues you should know about in the Policy Address

And what these imply.

According to Jones Lang LaSalle, the Chief Executive, Mr C.Y. Leung, delivered his second Policy Address today (15 January 2014) under the title ‘Support the Needy, Let Youth Flourish, Unleash Hong Kong’s Potential’. 

While there were no major changes announced on housing policy today, the Government did reiterate its commitment to increasing land supply for commercial and residential development, including the establishment of a development committee for Lantau Island; rezoning of GIC, green-belt, industrial and other government sites to residential use; and relaxing the maximum plot ratio of residential developments in certain areas by 20%. 

Here's more from Jones Lang LaSalle:

Land Supply - Short to Medium Term: The Pilot Scheme for Arbitration on Land Premium is a new initiative. While the intention of this pilot scheme is good, the Government will have to ensure the involvement of third party (the arbitrator) not to complicate and lengthen the overall process. Meanwhile, the Government has shown its determination in increasing land supply. However, since the initiatives for short-to-medium-term land supply will take some time before they can materialise, especially for sites requiring rezoning, it will unlikely solve the immediate housing shortage problem.

Land Supply - Long-term: The 13,600 units to be provided in the private residential market over the next 5 years on average, is still below the Government’s annual soft target of 20,000 units announced previously. However, given the Government’s commitment to ensuring adequate housing to the public, housing supply should continue to pick up over the long run. The Government’s aims at ramping up public housing at the same time, however, may potentially dampen demand and prices in the private market as buyers in the lower end of the market opt to buy/rent public housing instead.

Industrial and Commercial Developments: The Government has previously indicated that it would provide more sites in the CBD for office development, including the Murray Road Carpark in Central and the Rumsey Street Carpark in Sheung Wan. At present, known Government sites could yield at least 2.4 million sq ft NFA of office space in Central, alone. The key question remains, when will this land be made available for sale.

Lantau Island Development: Leveraging on the construction of new road links and expansion of the airport to promote the development of Lantau Island into another major urban centre is one of the more interesting initiatives presented in this year’s Policy Address. We look forward to the Government providing further details on their vision and how the commercial developments on the artificial island will create synergy with those in the airport’s North Commercial District.