Following is a question by the Hon Cheung Hok-ming and a written reply by the Secretary for Housing, Planning and Lands, Mr Michael Suen, in the Legislative Council today (December 7):
In late June this year, as long as an applicant applies for triggering of land for auction or tender, in respect of a certain site, at a price which is not lower than 80% of the open market value of that site as assessed by the Administration, the authority will accept the application concerned. Since the implementation of the above measure, only a few applications for triggering the sale of sites have been received, with no application received in September and October at all. In this connection, will the Government inform this Council whether:
(a) it has assessed the reasons for the lukewarm response; if it has, of the results of the assessment, and the improvement measures it will take; and
(b) it will consider resuming scheduled land auctions to ensure that the target on revenue from land sale will be met?
My reply to the two-part question is as follows:
(a) Since the announcement of the measures to enhance the smooth operation of the Application List System for land sale on 21 June 2005, the Government has received four applications for triggering the sale of sites in the Application List. Three of the four applications were accepted and the sites concerned were eventually sold by way of auction on September 27, 2005.
The Application List system operates on a market-driven basis. It enables the market to determine flexibly the timing and quantity of land to be put up for sale. Since the private property market is market-driven, private developers will plan their housing production based on the projected supply and demand in the market. So far, no particular assessment has been made on their response to the "Application List". Naturally, different private developers have different development strategies and their own market predictions, but the Government's overriding objective is to provide sufficient and suitable residential flats to meet market demand and to ensure that the market continues to develop in a healthy and steady manner.
The Lands Department is now working on the 2006-07 Application List and has written to the Real Estate Developers Association of Hong Kong (REDA) calling on the sites which REDA members express interest for inclusion in the Application List. We hope that the new Application List can better meet the needs of the market.
(b) The Government decided that, with effect from January 2004, Government land would be provided mainly through the Application List system. The position remains unchanged. The Government's estimates on revenue from land sale are compiled only for the preparation of the estimated revenue in the annual budget exercise. There is no question of the Government having to meet any target on revenue from land sale. To facilitate the steady and smooth operation of the market, it is important for us to maintain a clear and predictable policy for housing and land supply. At present, the Government has no plan to resume scheduled land auctions.
Ends/Wednesday, December 7, 2005
Issued at HKT 14:55