But govt figure still well short of 20,000 target

A report released by the Ratings and Valuation Department Friday said that it expects 10,670 private residential units to be built this year with another 13,700 completed next year.

Nevertheless, this is still well short of the government's target of an average of 20,000 flats per year amid fears of a property bubble in the city. Figures released last week by the Transport and Housing Bureau showed that 13,410 units were built in 2010, an 87 percent increase on 2009.

If the government's projections are accurate, the number of units completed this year would be down 22 percent from 2010. And only 3,300 units were completed in the first three months of this year. Figures for the period ended March 31 showed that although they were increased 43.4 percent compared with the previous quarter ended December 31, they fell 32.6 percent year-on-year.

And about 2,800 private homes started construction in the first quarter of 2011, up 64.7 percent from between October and December - but down 31 percent from the first three months of 2010.

However, Centaline Property Agency's director of research, Wong Leung-sing, told China Daily that the supply this year is "adequate".

"For home buyers who want to purchase a home in the New Territories, or want to search a small and medium sized flat, currently there are a lot of abundant choices in the market," Wong added.

"However, we think the government's projection is a little bit aggressive. Private residential flat completion can rise at a greater pace in 2013 when the current private residential flat construction starts to rise from its current low level in 2011. We predict private residential flat completion will just hover around 10,600 units and 10,000 units in 2011 and 2012 respectively."

Wong added that although private residential flat completion will still remain at a low level in 2011 and 2012, the figures are likely to see an upward trend in the next couple of years.

"As the government is accelerating the pace of land sales through auction or tender, and developers were also accelerating the submission of their building plans to the Building Department before the policy to limit the number of inflated buildings took effect on April 1, we forecast that the number of completed private residential units will see an upward trend in the next couple of years," Wong said.

Financial Secretary John Tsang said in early April that nine residential land sites would be put up for sale by the government in the second quarter in order to generate 2,650 residential flats. Tsang said in the government's budget speech on February 23 that the administration may sell a maximum of 52 land parcels that can build 16,000 units, almost 80 percent more than from land sold last year.

Chief Executive Donald Tsang said in his Policy Address last October that he planned to make land sites available that could build an average of 20,000 private homes every year for the next 10 years.

China Daily

(HK Edition 04/30/2011 page2)