Open-source intelligence (OSINT)
🔻 IMPORTANT 【重要】塑造全面炒家天堂
Shaping up a full-fledged speculator's paradise: On October 25, 2023 when the Policy Address was delivered, John Lee Ka-chiu immediately implemented the "Spice Reduction" (for speculators owning more than two residential units, the applicable period of the Special Stamp Duty (SSD) has been shortened from three to two years; the rates of the Buyer's Stamp Duty (BSD) and the New Residential Stamp Duty (NRSD) have been reduced from 15% to 7.5%; and the stamp duty for home ownership has been reduced by half, so to speak, and the stamp duty for foreign speculators/residents has been exempted before it is levied after becoming a permanent resident, etc.). At the same time, this means that the Central Government and the Chinese Communist Party formally approved the controversial measures in favor of Hong Kong speculators (ruling class).
From now on, official slogans such as "no speculation in housing", "common prosperity" and "resolving deep-rooted contradictions" will only lose more popularity in Hong Kong. Following the "sudden relaxation of the ZERO-COVID policy", the date of "reducing spiciness" is the turning point for Hong Kong to give up resolving deep-rooted conflicts.
Next, the current situation is that land and property speculation will continue to be rampant in the Northern Metropolis until the Hong Kong government initiates a large-scale land resumption and compensation exercise in 2027. As the ultra-high property price level confirms, "there is no more speculation in Hong Kong" is purely hypocritical. In other words, the reduction of spices and the complete withdrawal of spices after next year have already been planned to intensify speculation.
In the end, the 'development' model of the 1982 Mightycity Tin Shui Wai land speculation for huge compensation will be reproduced on a very large scale. Moreover, the so-called home purchase stamp duty concession for foreign talents also shows that the political intention of the Real Estate Party is to facilitate the importation of foreign speculators and to make the expatriates actively change into speculators.
In short, the shaping of a speculator's paradise is the future political and economic trends. The Chinese Communist Party and the vested interests in Hong Kong have no intention of changing the neo-liberal model of property and stock speculation. As a result, the disparity between the rich and the poor and the high land prices, high property prices, high rents, high dividend rates and high prices of goods are systematically deteriorating people's livelihood, consumption and business environment will only get worse. Therefore, ultra-high property prices are not just a problem of property prices per se. Hong Kong's economy is in the doldrums, which means that public consumption and SMEs' entry into the market are under pressure, and the main cause of the blow is the four highs (high land prices, high property prices, high rents, and high prices of goods).
In addition, negative assets are different from liabilities in that the culprit of negative assets is unaffordably high property prices. Overall, the hotbeds of discontent and public grievances that have given rise to massive political instability and emigration from Hong Kong will not go away in the future. The deep-seated contradictions in Hong Kong are highlighted in the housing/poverty issue and are manifested in the political economy by political instability and immigration.
The recent popularity of consumption in the north is also attributed to the four highs. That is, high rents have resulted in high prices for good and inexpensive goods. In addition, a feature that cannot be overlooked is that the ruling class in Hong Kong has secretly replaced the working class with the so-called opposition in politics to strengthen its own power. In other words, the ruling class in Hong Kong is actually using the working class as the opposition to secretly attack the interests of the working class. Drawing an equivalence between the opposition and the working class in order to promote policies that would only benefit the ruling class itself.
No Israel-Hamas War related demonstrations in Hong Kong: Since the outbreak of the Israel-Hamas War on October 7, 2023, there have been no anti-Israeli or anti-Hamas demonstrations or rallies which demonstrate the political orientation of the ruling class in Hong Kong. Although the Chinese media in Hong Kong tends to be anti-Israeli, there are still no anti-Israeli demonstrations or rallies. This is positive. It also contrasts with Hong Kong's treatment of the Russo-Ukrainian War. In other words, if the Russo-Ukrainian War demonstrations show that Hong Kong people's large-scale participation in demonstrations and rallies in international events unrelated to Hong Kong is a low probability.
After the deadline and the publication of this report, it was reported that on November 4, a group of six anti-Israelis went to the Israeli Consulate in Hong Kong to protest, and that Deutsche Welle DW cooperated with their action. This still doesn't count because it wasn't really mass, but rather a public relations stunt for the sake of making news, and it didn't have a wide public circulation or trigger mass action.
Regarding the various sophistries and distortions of the real estate party, the correct concepts and opinions not being reported by some media are as follows:
The storm over unauthorized building works (UBWs) in the Redhill Peninsula shows that UBWs are a form of property speculation. In other words, sub-divided units are also within the scope of UBWs (speculative properties). This means that the voluntary self-reporting system for UBWs (together with the suspension of enforcement against minor UBWs) is in effect a reporting system for sub-divided units. This also shows that there is no such thing as "no more speculation" in Hong Kong. Property speculation is so common and so potential that it has forced the Hong Kong Government to adopt a reporting system.
The so-called urban renewal is not charity redevelopment, but gentrification. It is gentrification, i.e., the compulsory sale of properties owned by small property owners in old slums, and then converting them into high-class residential areas filled with luxury residential units to sell which are hopelessly unaffordable for original owners.
Most of the so-called price indices in Hong Kong are for second-hand properties and are subject to the market share of each real estate agent (Centaline Property, Midland, Ricacorp Properties). In addition, Hong Kong has recently launched the CUHK's first-hand property price index. Therefore, the only indicator that reflects the overall property market is that of the Rating and Valuation Department. However, the RVD's property price index is based on a factor of rent or sale price divided by the rateable value of the property concerned and is definitely not based solely on the rent or sale price per square meter of floor area. For an accurate property price index, it is necessary to look at the previous and subsequent transaction records of a particular unit in a particular building to make a judgment. In this case, the bank valuation (market value) of the flat is emphasized. One blind spot is that for a particular flat, the so-called zero point of the price index represents the original price at the time of the original transaction, and 100% basically means that the flat was sold at double the price at the time of the second transaction. However, even if the property price index falls to zero, there is still the problem that the original price itself is sky-high. The Hong Kong Property Price Index is the sum of the cumulative increase in property prices over the years, so a relative drop in a few consecutive months can still add up to a full year's increase in property prices. Real estate agents and their media should truthfully disseminate all transactions that record an increase and those that record a decrease. Due to this characteristic, an increase in the volume of transactions will lead to an increase in the so-called price index, and vice versa. However, this does not mean affordability. "Affordability is the livelihood of the people" is the value that Hong Kong's politics needs to prioritize in terms of "home ownership" rather than the market's capital values (‘no huge ups and downs’ = maintaining super high prices). In the local media, there are mostly valuation theories, but the gain or loss in property price and bank loan amount can only be determined at the time of the transaction.
The so-called sub-divided units of poor quality is a typical misconception because all unsuitable accommodation is of poor quality. The Hong Kong Government has now dwarfed the concept of deep-rooted conflicts into the so-called sub-divided units of poor quality, which are no longer all sub-divided units. Then the so-called deep-rooted conflicts are not the 4-high system (high land prices, high property prices, high rents, and high prices) that has dealt a blow to consumption, well-being, and business, and they are not the army of speculators, and they are not the hegemony of the real estate sector. At present, speculators' sub-divided units and speculation on unsuitable accommodation will be licensed, moving towards the ridiculous stage of legalizing the operation of sub-divided units. In this way, the legalization and commercialization of unsuitable dwellings has led to a distortion of the concept of deep-rooted conflicts. This distortion reflects the political and ethical deformation of Hong Kong and Mainland China, which continues to shape the speculators' paradise. Then, it is Singapore, which has added spice this year, rather than Hong Kong, which has subtracted spice, that is really moving towards solving the housing problem. The two are in sharp contrast.
As a policy of prioritizing the demand for self-occupation, it is contradictory for the Hong Kong government to promote public housing rental, and public HOS should be vigorously promoted instead. However, the fastest way to reduce super-high property prices has been proven by the Government's practice for 85,000 houses to be public housing.
🔻 NEWS / FACTs 【事實關係】
The Secretary for Housing, Winnie Ho, said that in solving the problem of sub-divided units, the Government should first define sub-divided units of substandard quality, and then find ways to eradicate them and prevent them from proliferating. Speaking on a radio program, Ho said that having heard different views from different people on banning and preventing the proliferation of sub-divided units of poor quality, the authorities had to carefully consider different administrative means, for example, whether it was necessary to have legislation to complement the measures, how effective the existing Fire Safety (Buildings) Ordinance could be, and whether there was a need to supplement them. In addition, consideration will also be given to the need for a registration system to prevent the proliferation of sub-divided flats. The Working Group on Sub-divided Flats will study the issue in the future.
Hong Kong is a small and densely populated city with many types of unauthorized building works (UBWs). While the controversy over the UBWs on the Redhill Peninsula has aroused concern from all sectors of the community, and the urban UBWs in the urban areas have posed a hidden problem of injuries from height, the authorities are suspected of going in the opposite direction, and are now exploring the idea of not dealing with minor UBWs for the time being, and allowing owners to register their UBWs, which is suspected to be "letting go" of the minor UBWs. The Secretary for Development, Bernadette Linn, explained the incident yesterday, emphasizing that the move was a pragmatic way to combat UBWs and help record minor UBWs, and that the direction was the same as that of the existing exemption scheme in the New Territories. However, some surveyors considered that as the urban area is densely populated, it might be risky to extend the exemption for village houses in the New Territories to the urban area, and it would be difficult to ascertain whether the owners are genuinely at low risk of "minor UBWs", while some members reminded the Government of the need to adopt a risk-based approach.
The Government today announced the Action Agenda for the Northern Metropolis, under which the Government will formulate land use and development proposals for all new land development projects by next year, and initiate land resumption procedures for major development projects by 2027. Bernadette LINN, Secretary for Development, elaborated on the content of the Action Agenda at a press conference today. She said that the Action Agenda has set out the development priorities for the next three years for the three development areas and one area focusing on tourism and conservation, and there is also a dedicated chapter to set out the major milestones for the next ten years, which is divided into two five-year periods, echoing the result-oriented governance culture of the current-term Government, and will serve as an objective performance indicator for the development of the Northern Metropolis, so as to enable the public to monitor the progress and effectiveness of the Government's work. It will also serve as an objective performance indicator for the development of the Northern Metropolis so that the public can monitor the progress and effectiveness of the government.
According to a Hong Kong media report on the 26th, after the Policy Address announced the "spicy reduction", the Kowloon Station, which has always been highly sought after by mainlanders, has benefited in real time, with some real estate staff revealing that they have received 10 groups of enquiries from mainlanders. Some analysts believe that apart from the impact of the "spicy measures" on Hong Kong's property market, there are also other factors, such as the rate of rental return. In addition, the amount of land development is also very important. There are not enough public housing units in Hong Kong, and real estate developers holding idle land have no incentive to build public housing units.
▪️（10/07/2023）過去35年港整體樓價升幅1305% 大學生置業能力每況愈下： 新青年論壇今(7日)公布《香港各世代大學學歷勞工住屋承擔能力研究報告》，數據顯示，對比1987年及2022年的35年間，香港整體樓價指數升幅達1305.7%，大幅拋離通脹升幅的221.8%，而租金升幅則相對溫和，為279.4%。
Over the past 35 years, Hong Kong's overall property prices have risen by 1305%. University students' home buying ability is deteriorating: New Youth Forum today (7th) announced "Hong Kong's various generations of university-educated workers housing affordability research report". The data show that, compared to 1987 and 2022 in the 35-year period, Hong Kong's overall property price index rose by 1305.7%, a significant deviation from the rate of increase of 221.8% of the rate of inflation, and the rate of increase in rents. On the other hand, the increase in rent is relatively moderate at 279.4%.
The development of the Northern Metropolis has become a business opportunity for rural triads to suck blood. Recently, the Oriental Daily News has received reports from readers that people with government backgrounds and local officials, rural gentry, former CPPCC members and triads are all eyeing the development plan after learning about it, and they are plotting to build fake graves, fish ponds and squatters in the area of the development area, so as to monopolize the land for their own enrichment, and to win the government's resumption of the land to cheat for compensation. It is understood that there are already four to five triad gangs which are eager to get a share of the land by hook or by crook. After the incident was exposed, a land monitoring organization criticized the government for improper land planning and failing to eliminate land speculation, speculation in general and irregularities.
The Singapore government announced yesterday that it is stepping up its efforts to regulate the property market by increasing the Additional Buyer's Stamp Duty (ABSD) rates for Singapore citizens purchasing a second or more residential units, as well as for foreign nationals and corporations, with foreign buyers paying the highest rate of "spice" on their ABSD payments, which has been adjusted upwards from 30% to 60% across-the-board. The authorities emphasized that this is aimed at cooling down the local property market and promoting a sustainable real estate market.
"With strong demand for owner-occupied homes and renewed investor interest in Singapore's property market, there is a risk that property prices could outpace economic fundamentals and continue to grow relative to incomes if they are not tightened up".
🔻 COMMENT 【評語】
In a nutshell, it is the current political and economic trend of Hong Kong to continue to shape the speculators' paradise. Reducing and withdrawing the spices - anti-speculation taxes - for the sake of land and property speculation in the Northern Metropolis will only make it difficult for the Hong Kong Government to resume land for compensation. Not only is it a blatant lie that "there is no speculation" = no super-high property prices, but the distorted notion of sub-divided flats is also a manifestation of a deep-rooted contradiction in concepts that have been deformed and belittled by the crony coalition of vested interests. Property speculation means ultra-high property prices, and ultra-high property prices also mean property speculation, which is hard evidence of the tyranny of speculators. The so-called deep-rooted conflicts originally refer to the 4-high system (high land prices, high property prices, high rents, high commodity prices) established by the real estate oligarchy to undermine and dry up the costs of public consumption, well-being, and starting up a business, and the problem of inappropriate accommodation is a derivative rather than a cause of it.
Admittedly, the reduction and withdrawal of spices - anti-speculation taxes - is contrary to solving the deep-rooted conflicts. The speculators' paradise will be a more politically unstable social state that promotes immigration. After four years of working hand in hand with external forces, and China’s forced shift to co-existence with viruses, the so-called recovery is far from being realized, and the progressive part of Hong Kong's ruling class has abandoned the lesson of the anti-extradition amendment bill incident and the original intention of genuine reform. In fact, to the real estate party, the Northern Metropolis is meant to be a big pie to maximize compensation for land resumption. The Northern Metropolitans itself is likely to be reduced to a "real estate project" as usual. In the end, the policy address has negated the value of "prioritizing the demand for self-occupation of housing".
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