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Hong Kong shop owners seek higher prices after scrapping of double stamp duty
- Buyers are also more willing to meet sellers at higher price points as cancelled duty lessens financial burden
- Sales of non-residential units rose 30.6 per cent month on month in December
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Hong Kong shop owners are more likely to stand firm on asking prices, as they expect investors to flood the market after the city scrapped the double stamp duty for non-residential property, investors and property agents said.
Buyers are also willing to settle at higher price points since their total expense will still be lower than before the duty reverted to its original rates on November 26 last year, said Dennis Cheng Tak-ming, a senior sales director at Ricacorp (CIR) Properties.
The Double Ad Valorem Stamp Duty (DSD), introduced in February 2013 to curb speculation, was scrapped for non-residential property after prices dropped and transactions slowed during the coronavirus pandemic and Hong Kong’s worst economic recession on record. Its maximum rate has dropped back from 8.5 per cent to 4.25 per cent.
December last year saw the sale of 1,529 non-residential units, a 30.6 per cent month-on-month rise from the 1,171 units that changed hands in November, according to Land Registry data. While the December data reflects market sentiment in November, Cheng said rumours about the double duty being axed that circulated weeks before the announcement had led to more transactions.
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