To restrict or not to restrict

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Legislators voted down a proposal for debate by legislator Ng Kuok Cheng last Friday, on whether restrictions should be imposed on non-residents looking to purchase housing in the future new urban zones to be developed.
“The Government has to be resolute, to implement the new reclaimed land policy for Macau people, creating a system of restrictions on the purchase and sale of housing units located in new reclaimed land […] in order to establish a distinction between their intention for housing or speculation, and to ensure the needs of residents who intend to buy a home to live in,” read the proposal by legislator Ng Kuok Cheng.
The Macau New Urban Zone includes five new land plots that will increase the MSAR land area by 3.5 square kilometres, with 50,000 housing units to be developed in the newly reclaimed areas and 28,000 to be for public housing.
According to the directly elected legislator, any remaining units that are granted for private housing or economic housing, to be sold on the private market in the future, should be subject to purchase and sale restrictions, in order to support local residents in finding housing.
However, the debate proposal was rejected at the Legislative Assembly (AL) plenary session on Friday with 14 votes against and 12 in favour, with legislators divided over whether polices should be put in place to favour local residents in purchasing the housing units.

Free market
Several legislators from the construction and investment sector considered that applying restrictions on the sale of housing units would go against the capitalist and free market system in place in the MSAR until 2049, while constituting discrimination against outside investors and buyers.
“We have to think of the practical applications of the policies to revert secondary effects of housing. We can’t impose a limit on housing purchases. This won’t improve the situation and will have a negative impact on the real estate. It doesn’t make sense that people that come to invest in the Greater Bay Area can’t purchase in the region. Too many restrictions will just limit development,” legislator and President of the Macau Association of Building Contractors and Developers, Tommy Lau Veng Seng, said.
For legislator Vong Hin Fai, applying the measures would create the notion that the MSAR wasn’t an “inclusive society”, with the city having a history of receiving people from many countries.
“The capitalist regime is implemented here and the market follows its rules,” legislator Vong stated.
However, like many of the legislators that voted against the proposal, Vong considered that the government should conduct a study and present a clear plan on what the regulations will be for the housing that will be sold privately.
“The MSAR Five-Year plan has a general urban planning, but of the 50,000 housing units, what will be the regime for housing that’s sold privately?” he added.
Legislator Song Pek Kei opined that the debate would be a good opportunity for members of the government to clarify questions on the “absence of an overall long term plan” for the new areas.

Protecting the people
The legislators that voted in favour of debating the restrictions considered that, with the rapidly escalating prices of housing, younger residents from lower to middle income brackets are not able to purchase affordable housing and should be protected by the government.
Referring to the recent data provided by the Financial Services Bureau (DSF), that the average price per square metre in Macau increased by 48 per cent year-on-year in May of this year, reaching MOP114.463 per square metre, legislator Ho Ion Seng considered that the government policies to control real estate prices were failing and that the offer of affordable housing needed to be increased.
Legislator Melinda Chan Mei Yi, who also voted in favour, stated that efforts should be made to protect the “sandwich” or middle class sector of society who wants to purchase housing for the first time.
“Before, paying 10 per cent of the house value was enough to buy a first house, but now people have to invest millions of patacas. Even in London, a real estate market similar to Macau, young people’s salaries allow them to purchase a house,” she added.