Wednesday, February 6, 2013

More cooling measures in HK a possibility

Hong Kong may roll out more property cooling measures given the risks from property price gains and elevated household debt, said its monetary chief Norman Chan.

He said debt is now “near historic high levels”, citing ratios of 58 to 59 percent of GDP in Q3 and Q4 respectively, adding that it may be difficult to repay considering the current housing and economic downturn.

If necessary, the Hong Kong Monetary Authority (HKMA) may introduce a sixth round of property curbs.

Back in October last year, the territory had increased taxes on foreign home buyers.

Chan noted that an overheating housing market may be the biggest risk to financial stability, the same warning that was issued by the International Monetary Fund (IMF) in December.

“If one believes that the housing market and the economy go in cycles”, household debt levels could heat up more if a downturn comes as “the economy will become more difficult and personal and household income will be negatively affected”, said Chan.

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C

Senior Sales Director
DTZ Property Network Pte Ltd (L3007960A)

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