MR CHAN CHUN-YING (in Cantonese):
Deputy President, after the Government’s introduction of various stamp duties and measures to tighten mortgage loans since 2012, the number of residential property transactions fell from over 91 000 in 2012 to some 62 000 in 2016, representing a decrease of 24%. However, the amount of outstanding residential mortgage loans in the same period increased by 28%, from $868.3 billion to $1,118.7 billion. Based on the number of transactions, the average amount of outstanding loans in each mortgage case experienced a surge of 89%, from $9.51 million to $17.96 million. How come the increase is so astonishing? While the surge in property prices is certainly a main reason, the soaring property prices can well offset the cost of stamp duties payable by non-local buyers is another reason. Therefore, from the annex provided by the Administration, we can see that the respective proportions of non-local individual buyers in primary and secondary residential property transactions in 2016 have showed signs of bouncing back. Given this trend, will the Government set a threshold to take measures to suppress the demand of non-local buyers when the proportion of non-local individual buyers exceeds a certain level?
SECRETARY FOR TRANSPORT AND HOUSING (in Cantonese):
Deputy President, I thank Mr CHAN for his question. It is true that the amount of mortgage loans has increased substantially. I have looked up the relevant information and found that Mr CHAN was right in pointing out that property prices in 2017 almost doubled those in 1997. While there may not be a direct correlation between the hike in property prices and the amount of mortgage loans, I think some connections are involved. Regarding what measures should be taken by the Government in different situations, as the development of the property market is actually out of the expectation of many people, it is still difficult to reasonably define when the market is “overheated” and “rational”. In respect of managing demand, the Government’s top priority is to suppress investment demand. That is why both non-local and local companies are subject to the payment of extra stamp duties in residential property transactions. In addition, non-local individual buyers (i.e. buyers who are not HKPRs) are also required to pay extra stamp duties as they do not buy residential properties for occupation, as in the case of local people. Under this arrangement, the Government is also aware of the problem of some HKPRs holding an excessive number of properties. In order to give other residents opportunities for home purchase, it is stipulated that if the buyer is a HKPR who does not own any other residential property in Hong Kong at the time of acquisition, the residential property transaction concerned is exempt from NRSD. However, if the buyer is an owner of any other residential property in Hong Kong at the time of acquisition, he/she will be subject to the payment of NRSD. Of course, a refund mechanism is in place for buyers to apply for a partial refund of NRSD paid after they have disposed of their single original residential property within the statutory time frame. The prime objective of these measures is to ensure that HKPRs, who do not own any other properties at the time of residential property acquisition, will not have to bear the extra burden of paying NRSD, thereby increasing their chance of home purchase. Of course, if the market is overheated and becomes irrational, we will consider other possible options, such as the introduction of measures on purchase restrictions as mentioned by Mrs Regina IP earlier. We have also drawn reference from many overseas practices and will continue to conduct studies and analyses. We will not rule out any possible measures in order to make sure that both the housing supply measures and demand-side management measures will be effective.
DEPUTY PRESIDENT (in Cantonese):
Mr CHAN, which part of your supplementary question has not been answered?
MR CHAN CHUN-YING (in Cantonese):
Deputy President, may I ask the Secretary whether the proportion of non-local buyers is a factor for consideration by the Government when introducing demand-side management measures?
DEPUTY PRESIDENT (in Cantonese):
Mr CHAN Chun-ying, please note that Members may only ask one supplementary question each time. If you wish to seek clarification from the Secretary, you must point out which part of your supplementary question has not been answered. Secretary, do you have anything to add?
MR CHAN CHUN-YING (in Cantonese):
In my supplementary question, my major concern was whether the proportion of non-local buyers would be a factor for consideration by the Administration when introducing demand-side management measures. Yet, the Secretary focused on local buyers in his reply. I would like to ask the Secretary what measures will be taken to deal with non-local buyers.
DEPUTY PRESIDENT (in Cantonese):
Mr CHAN, you have already clarified which part of your supplementary question has not been answered. Please sit down. Secretary, do you have anything to add?
SECRETARY FOR TRANSPORT AND HOUSING (in Cantonese):
We have been closely monitoring the number of non-local buyers. For example, the aggregate percentages of non-local company and individual buyers reached 4.6% in 2012 and the percentage dropped to 1.8% in 2016. We are actually well aware of these figures. If we find the situation unsatisfactory, we will consider the earlier suggestion made by Mr CHAN.