HK property stocks fall on stamp duty hike HK property stocks fall on stamp duty hike
Share this on WhatsAppShares in Hong Kong developers were battered on Nov 7 after the city’s leaders raised stamp duty to try to cool... HK property stocks fall on stamp duty hike

Shares in Hong Kong developers were battered on Nov 7 after the city’s leaders raised stamp duty to try to cool runaway home prices, AFP reported.

It said the government slapped a 15 per cent tax on all residential purchases, almost double the previous 8.5 per cent, except for first-time buyers who are permanent residents.

Home prices remain out of reach for most of the city’s seven million residents despite a series of measures by the government.

“Property risks have been increasing with the rapid surge of prices and transactions,” Financial Secretary John Tsang said when announcing the move.

“We have to prevent the risk of a property bubble from worsening, which in turn can threaten our economy and even the stability of the financial system.”

Analysts said the move would hurt the city’s property firms.

“The action is likely to have an immediate impact on the market, with turnovers and property prices obviously pressured in a short period,” said Willy Liu at Ricacorp Properties.

“Small and medium-sized properties will be among the first to bear the brunt.”

By the end of trade on the Hang Seng Index on Nov 7, Sun Hung Kai Properties had plunged 9.88 per cent to HK$104.00 (RM57.11) and Cheung Kong Properties lost 8.81 per cent to HK$52.80 (RM28.99).

New World Development tumbled 9.03 per cent to HK$8.87 (RM4.87) and Sino Land slumped 7.90 per cent to HK$11.66 (RM6.40), while Henderson Land was off 5.79 per cent at HK$43.10 (RM23.67).The broader index rose 0.7 per cent.

Bank of America said it had cut its ratings on Sun Hung Kai and New World, saying the higher stamp duty would hit about 25 per cent of property transactions, AFP added.

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