Chen Maobo: The calm market reaction after Hong Kong relaxes "tough measures" is actually a good thing.

According to the Zhongtong Finance APP, on November 7th, the Financial Secretary of the Hong Kong Special Administrative Region, Paul Chan, stated that although the Hong Kong government had relaxed three major measures in the property market, the market has not shown any significant improvement and there have been cases of unsuccessful bids for land in Tung Chung. The changes in the property market are influenced by a series of factors, including the economy, interest rate trends, the job market, and income growth of citizens. However, Hong Kong is a small open economy, and high interest rates have also slowed down the pace of growth. Therefore, it is reasonable for property buyers to adopt a cautious attitude. After the Hong Kong government relaxed the measures, the market's calm reaction is actually a good thing.

Chan pointed out that when the measures were introduced, the main purpose was to prevent short-term speculation and address the imbalance between housing supply and demand. However, in recent years, the speculative atmosphere in the property market has subsided, and with the stabilization of supply and demand, the Hong Kong government has adjusted some of the measures.

Chan stated that the number of negative equity cases in Hong Kong has risen to 11,000, but it is still far from the peak after the handover (over 100,000 cases). As long as customers continue to make loan repayments and interest payments, banks generally do not require early repayment of the loan for properties with negative equity. Even though there are still challenges in the external environment, Hong Kong's economy is still growing at a rate of over 3%, and the unemployment rate remains at 2.8%, reflecting the stability of Hong Kong citizens' ability to make payments. However, more importantly, the proportion of housing expenses to income is less than 40%, and the proportion of households with negative cash flow is less than 0.1%. It is believed that the Hong Kong property market will adjust in an orderly manner and will not pose a financial risk.