[ET Net News Agency, 7 May 2018] HK Chief Executive Carrie Lam has told the Legislative
Council that she will consider imposing a vacant housing tax for completed but unsold
inventories owned by developers. HSBC Global Research expects limited impact of the policy
on developers, as they have adopted a faster asset turnover since 2013.
Out of 9k unsold inventories, 67% of total were completed within 1.5 years and they are
gradually being absorbed by the market. Dated inventories should be of good margin given
the property price growth in recent years, the research house said.
HSBC views this measure as insufficient to ease the current housing shortage in Hong
Kong, but think it will drive developers to accelerate the pre-sales process of new
projects.
HSBC expects a long-awaited sector rerating within the next 12 months given residential
transaction volume recovery, led by developers. The sector is trading at an attractive 46%
NAV discount. Its key picks are New World Development (00017), Sun Hung Kai Properties
(00016) and CK Asset Holdings (01113). (KL)