Letters | What’s wrong with lower home prices for Hong Kong residents?

Readers discuss whether the government should scrap its property cooling measures, and question Hong Kong Science and Technology Parks Corporation’s priorities after it asked a recycler to vacate its premises

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Pak Tin Estate, a public housing estate in which which some blocks were redeveloped, in Shek Kip Mei on July 5. Photo: Yik Yeung-man

Published: 11:30am, 17 Oct 2022

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I refer to the report, “Hong Kong developers lobby government to end cooling measures, protect homeowners from negative equity amid price slump” (October 11). This is a ridiculous suggestion and just continues to demonstrate the greed of the developers and their industry representatives.

First, scrapping stamp duties would have no impact on homeowners with no desire to sell or buy another home. Second, notwithstanding some mortgages that may require homeowners to top up payments when the loan-to-value ratio of the property rises above a certain level, negative equity (when a home loan exceeds the market value of the property) has no bearing on a homeowner’s cash flow and debt servicing ability.

Third, given that around 23 per cent of the city’s population would be living below the poverty line if it weren’t for government assistance, a reduction in home prices means a larger market for first-time buyers. Think of the large number of Hongkongers under 35 years old who still have to live with their parents. Think, also, of the percentage of disposable income that goes to paying for accommodation here versus in other major cities.

Fourth, with lower property prices, the potential may exist for those in squalid living conditions – tiny flats, subdivided flats, cage homes – to improve their accommodation to something more humane.

Until Hong Kong sorts out its inexcusable housing crisis, the one thing we do not need is to open the gates to foreign buyers seeking yield and capital gain before we have adequately housed our people. We do not need to financially accommodate the billionaire developers that have done little to address the housing crisis. What we need are lower and affordable home prices, and to be knocked off the top of the list of the least affordable housing markets in the world.