_Our Views on 2025/26 Policy Address
Martin Wong, Senior Director, Head of Research & Consultancy, Greater China
On Stamp Duty & Low-altitude Economy
We regret that the latest Policy Address did not include any stamp duty measures. With around 30,150 new first-hand residential units entering the market in the next 18 months, high entry costs may further dampen buyer sentiment. We propose extending the HK$100 stamp duty to properties priced up to HK$6 million to stimulate demand.
Additionally, we support the government's efforts to develop the low-altitude economy. Incorporating drone logistics and smart infrastructure into new projects can revitalise underutilised spaces and enhance asset value. Adding aerial delivery and emergency drone facilities would also appeal to prime property buyers and investors.
Cyrus Fong, Executive Director, Head of Valuation & Advisory, Greater China
On Northern Metropolis
We support the Northern Metropolis initiatives, as the formation of a high-level committee reflects strong political commitment and policy continuity, which will enhance investor confidence. Streamlined governance and dedicated legislation will accelerate land development and improve project feasibility. Flexible financing models—such as land equity participation, bonds, and BOT schemes—will lower entry barriers and encourage broader market participation. The phased release of land for the University Town from 2026 to 2030 offers prime opportunities for mixed-use developments, including student housing, research facilities, and retail, fostering vibrant education-led urban clusters. Proximity to Shenzhen further strengthens cross-border development potential, driving demand for Grade A office space, R&D hubs, and premium residential units. As industries scale up, job creation will fuel demand for workforce housing and supporting amenities. The adoption of modern, cost-effective construction methods will enhance project viability and align with ESG standards, appealing to sustainability-focused investors.
Russell Lam, Executive Director, Capital Markets
On Student Accommodations
We welcome the government’s decision to raise the admission ceiling for self-financing non-local students at publicly funded universities to 50%, starting from the 2026/27 academic year. This reflects the growing international interest in Hong Kong’s higher education and strengthens its position as a global education hub. The “Hostels in the City Scheme” supports the conversion of underutilised commercial buildings—including hotels—into student hostels, and we fully endorse the government’s proactive stance on education and related infrastructure. This policy is both timely and strategic, enhancing asset utilisation and offering new opportunities for older Grade B and C office buildings. It will help alleviate the acute shortage of student accommodation. We believe student hostels will continue to attract investment due to their stable income and relatively low conversion barriers.
William Lau, Senior Director, Head of Residential Agency
On New Capital Investment Entrant Scheme
As of the end of August, the New Capital Investment Entrant Scheme has received over 1,900 applications. If all are approved, it could bring approximately HK$58 billion in capital to Hong Kong. We therefore support the proposed adjustments to the scheme, particularly the lowering of the residential property transaction threshold from HK$50 million to HK$30 million. This change will help stimulate demand in the luxury property segment, facilitate the absorption of unsold inventory, and contribute to price stability. Expanding the scheme’s accessibility reinforces Hong Kong’s position as a preferred destination for global investors with immigration and property acquisition needs. Allowing residential property value to count toward the investment quota—especially with a cap—can enhance transaction activity and liquidity, and serve as a stabilising force during market downturns. As demand for high-end homes rises, developers will be more motivated to launch new projects, supporting the recovery of the real estate.
Adam Lee, Executive Director, Head of Planning & Land Advisory Services
On Northern Metropolis & Land Policies
We support the implementation of the "pay for what you build" policy in the Northern Metropolis. This policy calculates the land premium based on the actual built floor area and use by owners, accurately determining the land premium and avoiding pre-calculation based on the maximum plot ratio. This effectively reduces the initial development costs and alleviates financial pressure. At the same time, it allows owners to pay the land premium in phases, enhancing the flexibility of cash flow and reducing the financial burden caused by one-off upfront payment, which helps promote reasonable progress and the feasibility of developments. Furthermore, this policy encourages more efficient and rational land use, preventing overestimation of development potential and promotes sustainable developments.
This adjustment of relaxing GFA exemption arrangement for car parks offers benefits that go beyond construction cost reductions. It also shortens development timelines, accelerating project completion. However, projects subject to tight building height limit may not benefit from this relaxation. To improve this measure, we recommend that the HKSAR Government consider easing building height restrictions in such cases. This will allow such developments to accommodate additional carpark floors above ground without sacrificing their topside development GFA, ensuring a better coverage of the measure.