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Owing to the outbreak of SARS, both private residential property prices
and transaction volume hit a low point in the second quarter of 2003.
The market, however, had been improving since the third quarter. The average
property price in the fourth quarter had returned to the pre-SARS level.
The price level in December was 10 per cent higher compared with July.
The number of residential property transactions in the fourth quarter
saw an increase of 29 per cent over the third quarter, and an increase
of 51 per cent over the fourth quarter in the previous year.
As one of the measures to help revitalise the private housing market,
the Government announced in November 2002 that it would seek to remove
the security of tenure restrictions currently imposed on landlords of
rented premises with a view to restoring the free operation of the private
rental market.
Under existing security of tenure provisions in Part
IV of the Landlord and Tenant (Consolidation) Ordinance, if a tenant seeks
to renew the tenancy and is willing to pay the prevailing market rent,
the landlord would have to agree to the tenancy renewal. Only on certain
statutory grounds can the landlord refuse to renew the tenancy. Given
the ample supply of rental units in the market and the drastic reduction
in rentals, such protection in favour of tenants is no longer justified.
The Government therefore considers it timely to remove the security of
tenure provisions for domestic tenancies.
A public consultation was conducted in March 2003
on the proposal to relax security of tenure. The majority of the respondents
were in favour of the proposal. In June 2003, the Government introduced
into the Legislative Council the Landlord and Tenant (Consolidation) (Amendment)
Bill 2003 to, among other things, remove the security of tenure restrictions
for domestic tenancies.
The Estate Agents Authority (EAA) was established
on November 1, 1997 to devise licensing arrangements and practice directions
for estate agents. The Estate Agents (Licensing) Regulation became operational
on January 1, 1999. All estate agents are now required to obtain a licence
to practise.
The Estate Agents Practice (General Duties and Hong
Kong Residential Properties) Regulation and the Estate Agents (Determination
of Commission Disputes) Regulation took effect on November 1, 1999. The
former stipulates rules relating to the conduct, duties and practice of
licensed estate agents. The latter prescribes rules and procedures for
the EAA to assist in the mediation of disputes between an agent and a
client. The Estate Agents (Registration of Determination and Appeal) Regulation,
which came into operation on March 1, 2000, prescribes the procedural
rules for the EAA to adjudicate in disputes on the amount of commissions
payable to estate agents and for aggrieved parties to lodge appeals.
In order to ensure the provision of comprehensive and sufficient sales
information of local uncompleted residential properties to potential purchasers,
a committee set up by the Government in August 2001 has been monitoring
information contained in sales brochures on local uncompleted residential
flats to enhance consumer protection. The committee comprises representatives
from the Legislative Council, the Consumer Council, the Real Estate Developers
Association, the HKHA, the HKHS, and the legal, surveying and building
professions. Views about sales descriptions of local uncompleted residential
properties are collected through the website and the bilingual telephone
hotlines of the Housing, Planning and Lands Bureau.
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