2016年CRI Negative Equity Cases Soar in Hong Kong Amid Falling Prices

 

In a disturbing trend for newer home owners in Hong Kong, the city's Monetary¹ Authority has revealed cases of 'negative equity²' have increased 14-fold through the first three months of this year, with over 14-hundred additional home owners dealing³ with it.

'Negative equity' refers to the scenario⁴ where the current market price of the property is below what the owner has in their outstanding mortgage.

Ivy⁵ Wong with Centaline Mortgages says the growing trend is something home owners in Hong Kong need to be aware of.

"The current price is 13 percent lower from the peak, if the mortgage is over 90 percent, it is likely to be a negative equity."

Hong Kong's Monetary Authority has repeatedly tightened⁶ the mortgage rules to cool down the market.

Right now, if you want to buy a house you want to live-in yourself in Hong Kong which costs less than 7-million, you're going to have to put down at least 40-percent.

However, Wan⁷ Wai Ming, General Manager of K. Wah Real Estate, says lenders associated with property developers are finding ways to get around those rules.

"For average people, it's pretty difficult to come up with a 40-pecent down payment for a two-bedroom apartment in Hong Kong. And because developers see continued demand from first-time buyers, they want to provide them with financial help. They will reference the guidelines from the Hong Kong Monetary Authority, but will 'fine-tune' the limit."

Hong Kong economist⁸ Andy Kwan says they can do this by finding loopholes in the regulations, which he says is essentially⁹ predatory lending.

"If a secondary mortgage is taken out which goes beyond the regulations, which can't the monetary authority do anything about it? If you can't make your payments to loans from mortgage companies, it means you're among the group which aren't truly able to afford to buy a property. And once the market plunges¹⁰, these people are the first to be hit. It will be a disaster for them."

Despite these concerns, Hang Sang Bank Chief Executive Rose Lee says it's still too early to be talking about a property market crash in Hong Kong right now.

"Even though the number of negative equity cases has jumped from dozens to over a thousand, the numbers are still not very high. Most of the home-owners with negative equity have mortgages with over 90 percent left. But they are the homes of the borrowers themselves, and most of them still have the ability to repay their loans."

Despite attempts by authorities in Hong Kong to keep the property market stable, which has included higher stamp duties, Hong Kong's property market still remains¹¹ one of the least affordable¹² in the world.

But as the retail¹³ sector¹⁴ continues to struggle in Hong Kong, there are growing concerns about a ripple-effect.

Still, the Hong Kong government has no reported plan to loosen its restrictions¹⁵, saying the city's Monetary Authority is still closely monitoring the property market, and says it will take steps to maintain the stability of the banking¹⁶ system, if necessary.

1 monetary   

adj.货币的，钱的；通货的；金融的；财政的

参考例句：

• The monetary system of some countries used to be based on gold.过去有些国家的货币制度是金本位制的。
• Education in the wilderness is not a matter of monetary means.荒凉地区的教育不是钱财问题。

2 equity   

n.公正，公平，（无固定利息的）股票

参考例句：

• They shared the work of the house with equity.他们公平地分担家务。
• To capture his equity,Murphy must either sell or refinance.要获得资产净值，墨菲必须出售或者重新融资。

3 dealing   

n.经商方法，待人态度

参考例句：

• This store has an excellent reputation for fair dealing.该商店因买卖公道而享有极高的声誉。
• His fair dealing earned our confidence.他的诚实的行为获得我们的信任。

4 scenario   

n.剧本，脚本；概要

参考例句：

• But the birth scenario is not completely accurate.然而分娩脚本并非完全准确的。
• This is a totally different scenario.这是完全不同的剧本。

5 ivy   

n.常青藤，常春藤

参考例句：

• Her wedding bouquet consisted of roses and ivy.她的婚礼花篮包括玫瑰和长春藤。
• The wall is covered all over with ivy.墙上爬满了常春藤。

6 tightened   

收紧( tighten的过去式和过去分词 )； （使）变紧； （使）绷紧； 加紧

参考例句：

• The rope holding the boat suddenly tightened and broke. 系船的绳子突然绷断了。
• His index finger tightened on the trigger but then relaxed again. 他的食指扣住扳机，然后又松开了。

7 wan   

(wide area network)广域网

参考例句：

• The shared connection can be an Ethernet,wireless LAN,or wireless WAN connection.提供共享的网络连接可以是以太网、无线局域网或无线广域网。

8 economist   

n.经济学家，经济专家，节俭的人

参考例句：

• He cast a professional economist's eyes on the problem.他以经济学行家的眼光审视这个问题。
• He's an economist who thinks he knows all the answers.他是个经济学家，自以为什么都懂。

9 essentially   

adv.本质上，实质上，基本上

参考例句：

• Really great men are essentially modest.真正的伟人大都很谦虚。
• She is an essentially selfish person.她本质上是个自私自利的人。

10 plunges   

n.跳进，投入vt.使投入，使插入，使陷入vi.投入，跳进，陷入v.颠簸( plunge的第三人称单数 )；暴跌；骤降；突降

参考例句：

• Even before he plunges into his program, he has his audience in his pocket. 他的节目甚至还没有出场，就已控制住了观众。 来自《简明英汉词典》
• 'Monseigneur, he precipitated himself over the hill-side, head first, as a person plunges into the river.' “大人，他头冲下跳下山坡去了，像往河里跳一样。” 来自英汉文学 - 双城记

11 remains   

n.剩余物，残留物；遗体，遗迹

参考例句：

• He ate the remains of food hungrily.他狼吞虎咽地吃剩余的食物。
• The remains of the meal were fed to the dog.残羹剩饭喂狗了。

12 affordable   

adj.支付得起的，不太昂贵的

参考例句：

• The rent for the four-roomed house is affordable.四居室房屋的房租付得起。
• There are few affordable apartments in big cities.在大城市中没有几所公寓是便宜的。

13 retail   

v./n.零售；adv.以零售价格

参考例句：

• In this shop they retail tobacco and sweets.这家铺子零售香烟和糖果。
• These shoes retail at 10 yuan a pair.这些鞋子零卖10元一双。

14 sector   

n.部门，部分；防御地段，防区；扇形

参考例句：

• The export sector will aid the economic recovery. 出口产业将促进经济复苏。
• The enemy have attacked the British sector.敌人已进攻英国防区。

15 restrictions   

约束( restriction的名词复数 )； 管制； 制约因素； 带限制性的条件（或规则）

参考例句：

• I found the restrictions irksome. 我对那些限制感到很烦。
• a snaggle of restrictions 杂乱无章的种种限制

16 banking   

n.银行业，银行学，金融业

参考例句：

• John is launching his son on a career in banking.约翰打算让儿子在银行界谋一个新职位。
• He possesses an extensive knowledge of banking.他具有广博的银行业务知识。