HONG KONG: Hong Kong's government Friday unveiled its latest attempt to cool the red-hot property market, amid public anger at spiralling prices and fears highlighted by the IMF of a real estate bubble. Financial Secretary John Tsang announced a sliding scale of new stamp duties to take effect midnight Friday aimed at restraining what he called “short-term speculative” inflows into the glitzy financial hub's property market. “These are extraordinary measures under exceptional circumstances. Our aim is to curb short-term speculative activities and to reduce the risk of any asset bubble,” Tsang told journalists. The densely populated city of seven million is famous for its sky-high residential rents and super-rich tycoons. It notably attracts wealthy buyers from mainland China looking for a relatively safe place to invest with high living standards. But the International Monetary Fund this week urged Hong Kong to rein in soaring prices, amid fears that overheating is spreading from high-end luxury properties to the general market. Under the levies outlined by Tsang, anyone reselling a property within six months of purchase would be subject to a hefty 15 percent stamp duty. A 10 percent duty would apply to sales within six-to-12 months and five percent to sales within 12-24 months. Luxury home values in the former British colony recently topped their pre-1997 Asian financial crisis peak, according to government data released in October. Friday's announcement marks the latest in a series of measures already taken to cool the ever-expanding market. Stamp duty on luxury property was hiked by half a percentage point in April to 4.25 percent, while a number of government land auctions have been held to increase supply. But prices have crept ever higher, and are up 20 percent in the past year. The IMF warned in a report on Thursday that, “depending on the amplitude of the upswing, the resulting downturn could prove both protracted and painful”. Concerns have been amplified after the Federal Reserve unveiled a massive stimulus package to kick-start the US economy, raising fears that a flood of speculative money could overheat Hong Kong's volatile asset markets. Earlier this month, the city's biggest realtor, Centaline, recorded the highest commercial property price per square foot in Hong Kong's history. A 79th floor unit in The Center – a downtown skyscraper owned by Hong Kong's richest man Li Ka-shing – sold for 338 million Hong Kong dollars ($44 million), or about 25,580 Hong Kong dollars a square foot. – Agence France
