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Carrie Lam policy address 2019
Hong KongHong Kong Economy

First-time homebuyers in Hong Kong can aim for pricier flats as city’s leader Carrie Lam announces measures to relax mortgage rules but critics slam move

  • Government-backed agency will relax the ceiling on mortgage financing schemes for first-home buyers
  • Urban Renewal Authority also given new mission of building more subsidised housing, including starter homes

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Hong Kong has one of the world’s least affordable property markets. Photo: Martin Chan
Lilian ChengandSandy Li
First-time homebuyers in Hong Kong can now set their sights on more expensive flats under a new measure to relax mortgage rules announced in the policy address on Wednesday, sparking concerns people may take on too much risk in a downward market.
But the city’s leader, Carrie Lam Cheng Yuet-ngor, who also announced a new mission for the Urban Renewal Authority to build affordable flats, was quick to dismiss concerns that the move would drive up property prices and put buyers in a difficult financial situation.
Carrie Lam dismissed concerns about the new measure. Photo: May Tse
Carrie Lam dismissed concerns about the new measure. Photo: May Tse

Under the new measure, the government-backed Hong Kong Mortgage Corporation will relax the ceiling on mortgage financing schemes for first-home buyers. Purchasers will be able to borrow up to 90 per cent of a property’s value to a maximum of HK$8 million (US$1 million), from HK$4 million previously.

“It is an initiative to help those first-time homebuyers who have sufficient income to support a property but do not have enough money to pay for the first lump sum,” Lam said at a press conference after her policy address. “I do not feel this is pressurising people to buy and hence that they will be caught in a difficult financial situation.”

The stock prices of developers rose immediately after the policy address announcement. New World Development was the top gainer, climbing 4 per cent to HK$10.76. Sun Hung Kai Properties rose 2.9 per cent to HK$115.20 while Henderson Land gained 2.8 per cent to HK$38.25.

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