Cover IMF Working Papers
Are House Prices Rising too Fast in Hong Kong SAR?
Author: International Monetary Fund
Series:
IMF Working Papers
Volume/Issue:
Volume 2010: Issue 273
Language:
English
Publication Date:
01 Dec 2010
DOI:
https://doi.org/10.5089/9781455210800.001
ISBN:
9781455210800
ISSN:
1018-5941
Pages:
19
Keywords:
WP; price; benchmark price; house price; price growth; price misalignment; financial stability; prudential measures; ownership cost; Housing prices; Housing; Land prices; Real interest rates; Asset prices
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Sharp increase in house prices in Hong Kong SAR in 2009-2010 has led to concerns of an emerging real estate bubble. According to our measure of price deviation from fundamentals, which should be taken as an early warning indicator of market exuberance, the current level of house prices in Hong Kong SAR does not seem to be significantly higher than would be justified by underlying fundamentals. Moreover, unlike advanced economies before 2007-8, deviation from fundamentals has not been persistent in Hong Kong.Going forward, low interest rate and improving growth prospects, as well as a tight supply, particularly in the mass market, means that house price growth will continue to be strong.This is the period in which vulnerability may be accumulating, and tight prudential standards and fiscal measures will be required to tame price inflation.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund