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PRESS RELEASE

(Source : Information Services Department)

New round of demand-side management measures to address overheated residential property market

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     The Government today (November 4) introduced a new round of demand-side management measures to address the overheated residential property market and to guard against further increase in the risks of a housing bubble.

     The Government will amend the Stamp Duty Ordinance to increase a new flat rate of 15 per cent for the ad valorem stamp duty (AVD) chargeable on transactions for residential property, in lieu of the existing AVD rates at Scale 1 (i.e. doubled ad valorem stamp duty (DSD) rates). Except for specified exemptions, the new rate applies to all acquisitions of residential property by individuals or companies.

     The new measure will continue to adopt the exemptions provided for under the existing DSD regime. The major exemption is where the buyer is a Hong Kong Permanent Resident acting on his/her own behalf and is not a beneficial owner of any other residential property in Hong Kong at the time of acquisition of a residential property. Under such circumstances, the new AVD rate will not apply and the relevant transaction is only subject to the lower AVD rates at Scale 2.

     The new measure is only applicable to transactions for residential property. The existing arrangement of applying DSD rates to transactions for non-residential property remains in force.

     The new measure will take effect after midnight tonight, i.e. on November 5, 2016. Agreements for sale and purchase signed today or before today are not affected.

 

Ends/Friday, November 4, 2016
Issued at HKT 18:30