The government on Thursday cited Hong Kong's weak property market and recent failed tenders as it explained why it won't be putting a single residential or commercial site up for sale in the first quarter of this year.

"I think this is the first time in recent years in which we have not put up a private housing site for sale," said Development Secretary Bernadette Linn.

"In recent months, we have witnessed that the market is not too keen in tendering for residential sites. We do have failed tenders... This is a signal that the government has to take into account."

Linn said the government expects a total of 11,530 flats to be built in the current fiscal year, below the target of 12,900.

The government will put up for tender a 3.2-hectare industrial site in Yuen Long.

Linn said developers of this site will be required to allocate at least 30 percent of the gross floor area to the government so it can be rented out to businesses affected by development projects on brownfield land.

Chairman of Professional Property Services, Nicholas Brooke, said it is not surprising to see the government suspending residential site sales.

Brooke explained that the government's future land sale plan will depend on anticipated US interest rate cuts and market sentiment.

"We might have this quarter and the next quarter with minimal sales," he said.

"But if interest rates come off and there's more confidence in the market and developer sales pick up, then the government might, if you like, resume land sales in the third or fourth quarter of the year. That could well be the pattern."
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Last updated: 2024-01-04 HKT 19:52