HONG KONG: Hong Kong's finance chief said Friday the risk for people entering the territory's property market was "higher now than ever" as he announced new measures to tame runaway prices.
"This situation is rather unusual -- the property market trend is hard to predict," Financial Secretary John Tsang said.
"I urge citizens to think twice before entering the property market, as the risk is higher now than ever," he added.
Tsang said the government of the quasi-autonomous city was working to control ever-rising prices amid growing disquiet among the seven million-strong population over the rocketing cost of owning a home.
"The current market situation requires us to boost efforts in two respects. One is increasing land supply, the second is strengthening risk management in bank systems," he said.
"We will do both to ensure a healthy and stable development in the property market."
The number of public housing units on offer between July and August will be "substantially higher than the 3,000 units between April and June," he added.
The southern Chinese city has imposed new taxes and staged a series of land auctions in the past year-and-a-half to boost supply and bring down property prices.
Tsang's remarks come a day after a Hong Kong auction fell below record price estimates for a sprawling residential site, with analysts saying government measures to cool the real estate market may be taking hold.
The property in Hong Kong's central Mid-Levels district sold for HK$11.65 billion ($1.5 billion), below estimates that it could fetch between HK$12 billion and HK$15.2 billion -- and set a new city land auction record.
But another smaller plot in the city's New Territories fetched a sale price at the higher-end of estimates at the auction, suggesting officials still have work to do.
Two previous land sales earlier this year sold at the top of market expectations, or even surpassed pre-sale estimates.
Tsang said the Hong Kong Monetary Authority, the city's de facto central bank, will announce measures to tighten mortgage lending "very soon".
Carrie Lam, the secretary for development, was expected to announce details of the government measures on Friday.
Despite the measures, some existing properties are still fetching top-end prices with the home of France's top diplomat selling last month for a whopping HK$580 million.
A study by US consultancy Demographia in January found Hong Kong's home prices were the least affordable in the world.
Copyright AFP (Agence France-Presse), 2011
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