(Colliers Flash) The 2020-21 Budget: Cushion for the Economic Downturn; Yet No Extra Boost to the Land Supply
Colliers has released a Flash Report, The 2020-21 Budget. This report provides insightful analysis on the impacts of the latest government policies on the real estate market.
Against a backdrop of a difficult financial year, following demonstrations, trade tensions and now a coronavirus outbreak, Hong Kong’s Financial Secretary Mr. Paul Chan Mo-po delivered the annual Budget Speech On 26 February 2020. While supporting the city’s economic pillars, the budget unfortunately did not offer any new policies to boost the lack of residential and commercial land supply. Investors and occupiers should take advantage of the current discounted rental and capital values, and take this as an opportunity to position themselves to take advantage of longer-term potential gains.
Residential supply from land sales will fall short in the coming year, with only 21 development sites to be included in the upcoming land sale programme, including 15 residential sites and six commercial sites. These should provide up to 8.9 million sqft (830,000 sqm) of commercial space, compared to 8.8 million sqft (814,600 sqm) planned for FY2019/20. Meanwhile, measures aimed at aiding the struggling retail sector, such as a cash handout and reduction in profits tax, should help to ease the financial burden on business operators, especially for SMEs.
Read the full report here.