Restating Its Real Estate Underweight Rating, Citibank Foresees New HK Property Market Regulation

(Yicai Global) March 29 — Obstacles stopping Hong Kong’s government from imposing tough new real estate rules have been lifted, and the measures thus may roll out on any Friday after March 31, Citibank (Hong Kong) Ltd. said in a report.

In its research report issued yesterday, the bank — reiterating its underweight rating for real estate — advised investors to divest their shares in Kerry Properties Ltd. [HKG:00683], Cheung Kong Property Holdings [HKG:01113], Sino Land Co. [HKG:00083] and Henderson Land Development Co. [HKG:00012].

Data from different sources indicates that housing prices in Hong Kong have kept climbing at a monthly rate of two to three percent, hitting new highs in five weeks.

New regulations will mainly target those owning multiple properties and company-held properties, the bank predicted, adding that higher taxes at two or three times the regular rates may be imposed, but with first-time homebuyers exempted.

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