Paul Chan, Hong Kong’s Financial Secretary, stated that the government was in the process of considering easing mortgage loan-to-value ratios for residential property purchases in the city, as it is working with the Hong Kong Monetary Authority to balance the financial stability and interests of first-time home owners.
Last year, Hong Kong increased the cap on property acquisition for first-time buyers with a 10% down payment to HK$10 million from HK$8 million.
Chan warned residents against a high-interest rate environment as the market expected rate hikes from the US Federal Reserve in the second half of the year. Interest rates in Hong Kong closely track those in the United States as the local currency is tied to the US dollar.
According to the Standard newspaper report, Chan stated earlier this month that he would consider an additional easing measure of the loan-to-value ratio for first-time homebuyers but turned down proposals to alleviate property cooling measures, including adjusting stamp duties.
In addition, Citigroup Inc stated last month that home prices in Hong Kong may remain the same at the end of the year. The country’s residential market has shown some signs of weakness despite the rebound in the first quarter.
