Following is the transcript of remarks by the Secretary for Development, Mr Paul Chan, at the question-and-answer session of the media session today (December 29) on the quarterly land sale programme for January to March 2017:
Reporter: You just said there is no shortage of land supply. So why did you only put forward so few land this time, providing only around 3 000 units? The second question is that a lot of new flats are now very small. Is the Government going to do something about it, perhaps putting forward some sort of restrictions on flat sizes?
Secretary for Development: The total land supply for the coming quarter is in the order of about 3 600 flats, which by comparison to the previous three quarters is on the low side, but this is a deliberate decision. Please do not misinterpret that it is because of the lack of land or the Government's intention of reducing land supply. In fact, it is a deliberate decision taking into consideration the overall land supply situation in the preceding three quarters. In fact, taking into account the 3 600 units in the coming quarter, the land supply for the whole 2016-17 financial year is projected to be in the order of about 19 460 units, which is already 8 per cent above the target. We have to be careful not to exceed the target too much, otherwise the market may have doubt as to the credibility of the annual target announced by the Government. I think it is important to let the market have the confidence in the target figure announced by the Government, and have certainty about that. The land available for sale but will not be put up for sale in the coming quarter will be rolled over to the next financial year. That will also help us sustain land supply in the coming years.
Now in the market there are residential units of ridiculously small size. We have been monitoring the situation very closely. There are suggestions in the market that by supplying flats in such small size it will help the Government meet the land supply target. But I just want to let you know that is ridiculous. In fact, when we count the land supply figures in the past years, ever since we have set an annual target, although in the beginning two or three years, the land supply from the Government was short of the target, in the past two years and in the coming year, land supply indeed exceeded the target. When we check the building plans submitted by the developers who succeeded in bidding for the land, the actual supply in terms of the flat number exceeded our estimates by 3 200 units as of September. We are not counting on these small-sized units to meet the demand. There is no such case. At the moment, we do not find it appropriate for us to impose restrictions because when we sell the land and when this land turns into residential units, there is a time gap of several years. The market can change very quickly in the intervening years. So, we think perhaps we should at this stage leave the flexibility to the market so that developers can respond to the needs of the market appropriately. At this stage, we do not have the intention to impose restrictions yet.
(Please also refer to the Chinese portion of the transcript.)
Ends/Thursday, December 29, 2016
Issued at HKT 19:37