Land exchange scheme a long-term prospect: expert
A property analyst has said that changes to land premiums and land swap arrangements, aimed at speeding up the creation of the Northern Metropolis, may not be attractive to developers right now, but will work in the long-term.   Hannah Jeong, head of valuation and advisory services at Colliers Hong Kong, said given that the outlook for property market is depressed right now, developers may prefer to look for comparatively cheaper land in urban areas in the short-term.  "By 2034, the government wants the first phase of the population to settle down in the Northern Metropolis, but the compensation and resumption will take time, and building the infrastructure will require funding," Jeong said.  She added that a lot of the land in the North is scattered, with developers who are sitting on land for decades, and the new scheme will be limited to developers who have better size of land in the area.  The standard premium rate the government had put in place since 2021 has been lowered over the years, including in March 2022 for Kwu Tung and Fanling in the Northern Metropolis.  The recent announcement is an extension of this period, but also broadening the scope of exchanges to sites for industries and privately run communities.  "It will also save developers time, including in negotiations, in terms of conversion or changing the use of the land, if they choose the standard rate," Jeong said.  But she said even though the government has lowered the premium now twice, developers may not find the premium is attractive at the moment because the current market is soft right now.  "Developers can get cheaper land in urban areas right now, since the market is very soft. However, from the government's perspective, the new scheme is shooting for long-term impact."