HONG KONG (Reuters) – Hong Kong’s finance chief said on Thursday he did not see a major risk to the city’s real estate market or need to adjust asset control measures, as the financial center encouraged further interest rate hikes.
Finance Secretary Paul Chan made the comments after Hong Kong’s monetary authority raised the key rate during the overnight discount window by 75 basis points to 3.5%, the highest since October 2008, a similar move by the US Federal Reserve.
Chan said Hong Kong house prices fell more than 6% in the first eight months, but the property market depends on many factors, including employment and homeowners’ ability to pay, as rising prices hurt sentiment.
“I don’t think there’s any risk of a major adjustment,” he said. “Market transactions are low, but there is no need to adjust the control measures.”
Current measures include stamp duty on non-Hong Kong citizens and second home buyers.
Hong Kong banks, which have cut U.S.-equivalent rates in recent months by raising rates, are expected to raise their best lending rates from Thursday, the first increase since 2018.
Hong Kong private house prices fell to their lowest level since February 2020 in July, official data showed, as homebuyers grew weary due to rising interest rates and an uncertain outlook.