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Development of public and private residential areas in Hong Kong: guided by the allowed plot ratio, the formula is…
- Plot ratio = GFA/site area
- GFA = plot ratio * site area
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Site coverage (floor area) is ….
percentage of site covered by buildings and structure
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High-rise residential developments in HK urban districts: plot ratio around ….;
5-10;
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When height of building increases, ….increase while ….decrease
Plot ratio; site coverage
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Class C is the most expensive type of site because
It has higher site coverage and plot ratio
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Definition of class A, B C site
- A site: not being class B or C; abuts on one street
- B site: corner site, abuts on two street
- C site: corner site abuts on 3 streets
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Strategy about class A and C site -x
If you own a class C site, acquire the class A site next to you so that the entire site combined is class C
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Why are property prices so high?( relative to current income)
- More durable than other commodities
- A variety of interests (High rental yield, Development value, sometimes offer monopolies in operating certain business, eg. Hotel, parking) may subsist in it at the same timemore demand
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Property valuation/appraisal: involves
- all the features about the property
- all the underlying economic factors of the market, including the range of alternative investments (fixed deposit no longer attractive because of low interest; stock market fluctuates too much)
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Special stamp duty, buyer stamp duty, double stamp duty – who they target and is it effective
- SSD: penalty for sales of property within 6-36 months of holding period
- BSD: penalize buyers who are non-HK resident and company (regardless of residency status of shareholders and directors)
- DSD: penalize people who are owners already that purchase more properties;
- These measure just delayed increase; does not really lower property price
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Freehold vs leasehold
- Freehold: Permanent ownership of the building structure AND the land it stands on; owns “title absolute”; No need to pay annual ground rent (Malaysia)
- Leasehold: Lease land from the freeholder (“the state” in HK) to use the place for N years; If leaseholders don’t pay ground rent –then the lease could become forfeit
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Leasehold Land in HK- Land is leased in HK, at …; Only exception: ….(freehold land as long as it remains a church)
- Premium plus rent; the premium
- St. John’s Cathedral
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Land rules in Malaysia - renewal of leases
- A high premium could be imposed for renewal of leases
- But Government allowed RM1,000 renewal fee instead of full premium if owner stays
- If the owner sells/transfers the property subsequently, s/he must pay the full premium
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Difference btw HK and Singapore in housing
- Singapore: higher ownership rate; more usable floor area per person
- Smaller average household size
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Singapore urban areas often appear greener and more spacious because
difference in topography, urban design concepts & the extent of reclamation
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Land Supply in HK
- 1109.5
- Exclude existing built areas, country parks & natural reserves as “non-developable areas”
- Exclude topographically difficult areas
- Exclude small/scattered lots, harbor front and ecological sensitive areas
- 12.4% left, ie 138
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Possible solutions to land supply problem in HK
- Artificial islands in central waters
- Non-domestic premises (e.g. factory buildings): convert to residential (meeting structural and fire safety requirements)
- Increase domestic plot ratios for non-residential ones (not compromising environmental quality and traffic capacity)
- Increase traffic capacity by widening roads in the vicinity or/and adding new MTR stations
- agricultural land, or Brownfield, deserted in the North District and Yuen Long convert for residential use
- Special land leases to be sold at zero upfront premium but significantly higher ground rent
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