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Hong Kong CNN
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Hong Kong hasannounced a slew of measures to boost its real estate sector, includingthe removal of decade-old restrictions that were introduced to prevent a property bubble, as part of its effort to revive an economy that has been hurt by a record exodus of talent andan economic slowdown in mainland China.
Paul Chan, the financial secretary for the semi-autonomous Chinese city, said in his annual budget speech on Wednesday that the city would cancel all buy-side restrictions for residential homes and waive stamp duties on property transactions. The cancellation will take effect immediately.
“We consider that the relevant measures are no longer necessary amidst the current economic and market conditions,” Chan told the city’s legislature.
The canceled taxes include a 7.5% stamp duty on buyers who are not permanent residentsin the city, a 7.5% stamp duty on those purchasing a second home and a 10% to 20% stamp duty on those who sell their homes within two yearsof the purchase.
These taxes had been introduced as early as 2010 to cool the city’s once red-hot property market, a pillar of the economy. At the time, officials were worried about a housing bubble, in which prices rise above what is commonly believed to be reasonable or sustainable.
The government will also ease property lending policies to boost housing demand.
Real estate and related industries play a key role in Hong Kong’s economy, accounting for as much as a fifth of the city’s gross domestic product (GDP). Income from land sales comprise about one fifth of the government’s fiscal revenues.
But since last year, property prices have entered correction territory. By January, the government’s housing price index had fallen for nine straight months, the longest streak of declines in two decades. As of last month, it was down 23% from its peak in September 2021.
In Wednesday’s budget speech, Chan also said the government would set aside 1.09 billion Hong Kong dollars ($139 million) in funding to support the tourism industry, including organizing fireworks and drone shows each month at Victoria Harbour.
Hong Kong’s economy has struggled to regain momentum since it reopened after more than two years of self-imposed Covid isolation. In 2023, its GDP grew 3.2%, thanks to a low base in 2022, butitfell short of market expectations. An initial boom in tourism and consumption fizzled out within months after its reopening.
Other than a sluggish housing market, Hong Kong is also grappling witha record exodus of talent and a battered stock market, both of which could worsen as relations between Beijing and Washington become frostier.
Hong Kong’s stock market, where many of China’s largest and most important companies are listed, has become less popular with international investors.
Its benchmark Hang Seng Index fell 14% in 2023, making it one of the worst performing indexes globally. Late last year, the city’s stock exchange was overtaken by the National Stock Exchange of India (NSE) as the world’s seven largest bourse.
Hong Kong’s status as the financial hub of Asia is also under threat, with the government pushing to enact a controversial homegrown national security law that could have deep ramification on international businesses.
FREDERICTON – New Brunswick‘s finance minister says the province recorded a surplus of $500.8 million for the fiscal year that ended in March.
Ernie Steeves says the amount — more than 10 times higher than the province’s original $40.3-million budget projection for the 2023-24 fiscal year — was largely the result of a strong economy and population growth.
The report of a big surplus comes as the province prepares for an election campaign, which will officially start on Thursday and end with a vote on Oct. 21.
Steeves says growth of the surplus was fed by revenue from the Harmonized Sales Tax and federal money, especially for health-care funding.
Progressive Conservative Premier Blaine Higgs has promised to reduce the HST by two percentage points to 13 per cent if the party is elected to govern next month.
Meanwhile, the province’s net debt, according to the audited consolidated financial statements, has dropped from $12.3 billion in 2022-23 to $11.8 billion in the most recent fiscal year.
Liberal critic René Legacy says having a stronger balance sheet does not eliminate issues in health care, housing and education.
This report by The Canadian Press was first published Sept. 16, 2024.
OTTAWA – Finance Minister Chrystia Freeland says the government is making some changes to mortgage rules to help more Canadians to purchase their first home.
She says the changes will come into force in December and better reflect the housing market.
The price cap for insured mortgages will be boosted for the first time since 2012, moving to $1.5 million from $1 million, to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
On Aug. 1 eligibility for the 30-year amortization was changed to include first-time buyers purchasing a newly-built home.
Justice Minister Arif Virani is also releasing drafts for a bill of rights for renters as well as one for homebuyers, both of which the government promised five months ago.
Virani says the government intends to work with provinces to prevent practices like renovictions, where landowners evict tenants and make minimal renovations and then seek higher rents.
The government touts today’s announced measures as the “boldest mortgage reforms in decades,” and it comes after a year of criticism over high housing costs.
The Liberals have been slumping in the polls for months, including among younger adults who say not being able to afford a house is one of their key concerns.
This report by The Canadian Press was first published Sept. 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales rose 1.4 per cent to $71 billion in July, helped by higher sales in the petroleum and coal and chemical product subsectors.
The increase followed a 1.7 per cent decrease in June.
The agency says sales in the petroleum and coal product subsector gained 6.7 per cent to total $8.6 billion in July as most refineries sold more, helped by higher prices and demand.
Chemical product sales rose 5.3 per cent to $5.6 billion in July, boosted by increased sales of pharmaceutical and medicine products.
Sales of wood products fell 4.8 per cent for the month to $2.9 billion, the lowest level since May 2023.
In constant dollar terms, overall manufacturing sales rose 0.9 per cent in July.
This report by The Canadian Press was first published Sept. 16, 2024.
