Reuters: Hong Kong’s government said Tuesday it has no intention of modifying its property stamp tax, despite media rumors that it may waive the extra stamp duty mainland Chinese must pay to buy property in the city.
A Financial Secretary’s Office official replied, “There are no related plans.”
After government clarification, Hong Kong property developer shares plummeted. New World Development Company rose 3.3% after rising 6.1% in the morning.
Sun Hung Kai Properties gained 2.6%, while CK Asset Holdings and Henderson Land Development (OTC: HLDCY) gained more than 1%.
To boost the economy and reverse a brain drain, Regina Ip, convenor of the government’s advisory Executive Council, said Hong Kong may waive an extra stamp tax on homes for mainland Chinese buyers.
She later told Commercial Radio Hong Kong it was a New People’s Party notion that would be raised during Policy Address consultations.
On their first home, permanent residents pay a 4.25 percent stamp tax, whereas foreign buyers, particularly those from China, pay a 30 percent tax.
Hong Kong has been voted the world’s most overpriced property market for 12 years by Demographia.
As homebuyers stood on the sidelines due to an uncertain outlook and rising interest rates, Hong Kong’s private home prices fell quickly in June.