Hong Kong raises stamp duties to tame hot property market (updated)

Swire Properties

04/11/2016 10:41

* Stamp duties to be raised to 15 pct of transaction value 
    * First time local buyers exempt from the increased taxes 
    * Govt expects measures to have immediate cooling effect 
 
 (Adds details, quotes) 
    By Venus Wu and Clare Jim 
    HONG KONG, Nov 4 (Reuters) - Hong Kong will raise stamp 
duties on property transactions for the first time in three 
years, the latest effort to check an overheated property market 
buoyed by capital inflows from China. 
    Hong Kong's real estate is among the most expensive in the 
world and property experts have forecast that home prices will 
rise further this year. Skyrocketing property prices have added 
to growing discontent in the city, with its population already 
under strain from high living costs and a widening wealth gap.  
    The government will raise stamp duties on home purchases to 
15 percent, across the board, effective Nov. 5, to dampen a 
red-hot market which has failed to respond to a raft of measures 
taken by policymakers in recent months. 
    "We expect the measure to have an immediate and effective 
cooling impact," Financial Secretary John Tsang told a news 
conference. 
    First time local home buyers will be exempt from the latest 
policy tightening measures with stamp duty ranges remaining from 
1.5 percent to 4.25 percent depending on the value, officials 
said.  
    Hong Kong home prices surged in September for the sixth 
consecutive month to hit the highest level in nearly a year, 
government data showed on Monday. urn:newsml:reuters.com:*:nL4N1D120B  
    Soaring property prices this year are in stark contrast to 
the slowdown in the overall economy, as evident from flagging 
retail sales and slowing economic growth, and industry officials 
said renewed mainland purchases had been a key factor behind the 
rise.     
    One of the city's largest property agencies, Centaline 
Property Agency Ltd, has forecast home prices will return to 
peak levels in the fourth quarter this year. 
 
 (Additional reporting by Twinnie Siu and Donny Kwok; Writing by 
Saikat Chatterjee; Editing by Jacqueline Wong) 
 ((saikat.chatterjee@thomsonreuters.com; 852-2843-6548; Reuters 
Messaging: saikat.chatterjee.reuters.com@reuters.net)) 
 
Keywords: HONGKONG PROPERTY/MEASURES