Transcript About Chinese, Hong Kong, Macau Markets during Recent

About Chinese, Hong Kong,
Macau Markets during Recent
Financial Turmoil
Rose Neng LAI
University of Macau
Cambridge University
ERES 2010, June 25, 2010
Hong Kong
155.0
Sales Price Index
145.0
Rental Price Index
135.0
125.0
115.0
105.0
95.0
3*
2010 1
11
9
7
5
3
2009 1
11
9
7
5
3
2008 1
85.0
Hong Kong
• Market demand is always strong
• Market segmented
• Not much done till May 2010: the “nine
ways”
• More for market transparency, particularly
in presale market
• Note currency pegged to USD, thus can’t
change interest rate by much
Macau
Residential Price $/sq.m (Macau)
28000
26000
24000
22000
20000
18000
16000
14000
12000
10000
Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010
Residential Price $/sq.m
Macau
• Huge economic development since 2004 due to
the hospitality industry (higher GDP per capital
than Hong Kong, higher gaming income than
Las Vegas)
• Dropped since April 2008 because of slow down
in expansion, and Chinese government policy to
reduce tourist
• Boom again, surprisingly
• Not much done except
– The promise of 19,000 units of public housing by
2012
– More transparent information releases
– More guidelines on LTV ratios and rationing
China
住宅房屋销售价格指数
Ju
l-0
9
Se
p09
No
v-0
9
Ja
n10
M
ar
-1
0
Ju
l-0
8
Se
p08
No
v-0
8
Ja
n09
M
ar
-0
9
M
ay
-0
9
Ja
n08
M
ar
-0
8
M
ay
-0
8
102.5
102
101.5
101
100.5
100
99.5
99
98.5
98
97.5
97
二手住宅房屋销售价格指数
办公楼房屋销售价格指数
China
•
•
•
•
Always high demand for housing
Government encouraged private housing
Coupled with better economy
Bubbles in first tier cities that have not
burst
Government Intervention
• Capital Reserve
– ↑ in Jan, Mar, Apr, May 2008
– ↓ in Sep 2008
• LTV Ratio
– Explicit restriction in Aug 2008
• Interest Rates
– ↓in Sep, early and late Oct, late Nov 2008
• Related Tax
– ↓in Oct 2008 (deposit tax, property sales tax, property
tax)
– ↓in Oct 2008
• Other Policies such as First Home Program,
Measures to enhance housing
Government Intervention in 2010
• Dec 2009: measures to control speculative
activities, and land bank
• January: (1) down-payment of second home no
less than 40%; (2) Increase Capital reserve
• March: Land control
• April (gradually): (1) prohibition of mortgages for
speculative purpose, (2) initial payment of 2nd
home no less than 50%, (3) no mortgage for 3rd
home, (4) new definition of second home
(counted towards households versus individuals)
• May: Increase Capital reserve
What has happened?
• Hot money….. for better investments
• Spillover from China to Hong Kong and
Macau