All restrictions on Macao property sales were scrapped today in order to boost a local property market that has seen several consecutive months of falling prices. The government announced the move at a press conference this afternoon.
The main points are:
1) The 10 percent stamp duty will be waived for the purchase of a third property;
2) Owners will not face any fines if they sell their property within a two-year period;
3) Foreign investors will no longer be required to pay an extra 10 percent in stamp duty, although they will still be required to pay other general property taxes;
4) Foreign investors can now also borrow up to 70 percent of a property’s value for their mortgages.
The “two percent stress test” requirement for mortgages – under which lenders look at a borrower’s ability to repay if interest rates rise by two percentage points – will also be suspended.
Local property agent Ken Ho told Macao News that “I think the situation will be similar to Hong Kong, where the number of transactions will go up, but prices will only recover gradually … it ultimately depends on the economy and interest rates.”
[See more: Macao’s residential property price index continues its downward trend]
Pauline Ma from Centaline Macau also told Macao News that “Macao has lifted all their restrictions which is good for the market. It is not exactly like Hong Kong however. In Hong Kong, purchasing a property valued at over HK$ 30 million entitles you to obtain a Hong Kong ID. Macao, on the other hand, has not yet implemented a similar policy.”
During the conference, the director of the Financial Services Bureau, Iong Kong Leong, stated that the new measures were intended to help stimulate the ailing property market, which has seen falling prices and poor sales in recent years.
The government already removed some market curbs at the beginning of this year, including the 5 percent stamp duty that buyers of second homes had been required to pay. Mortgage rate regulations were also relaxed.
Industry representatives have been repeatedly calling for the government to follow Hong Kong’s lead and dispose of punitive imposts that were originally introduced in 2010 and 2018 to combat speculation.
The sector is continuing to call on the government to relax restrictions on the residency investment scheme as a means to further boost sales.
