(Yicai) March 6 -- The residential property transaction volume in Hong Kong rapidly rose after the Chinese special administrative regions lifted restrictive measures on the real estate market.

Nearly 590 new properties were sold in Hong Kong between Feb. 28 and March 3, up over two-fold from the total in February, according to data from Centaline Property. On the weekend of March 3, some 452 new properties were sold, an increase of 19-fold from the previous weekend.

On Feb. 28, Hong Kong's Financial Secretary Paul Chan said in its 2024-2025 budget speech that all property buyers in the SAR will be spared from paying additional stamp duties, buyers' stamp duties, and new residency stamp duties.

On the same day, The Hong Kong Monetary Authority adjusted the countercyclical macroprudential measures for property mortgage loans, including raising the loan-to-value ratio for self-occupied and and non-self-use residential properties.

The restrictive measures were lifted because of the sustained downturn in the SAR's property market. Hong Kong's property price index fell 1.6 point to 306.4 points in January from December, down for the ninth consecutive month to the lowest since October 2016, according to data released by the Rating and Valuation Department of Hong Kong on Feb. 27.

The tax burden for residents purchasing properties in Hong Kong after the adjustments plunged to 1.5 percent from 7.5 percent, according to estimates by property agency Midland Realty. Meanwhile, the stamp duty for non-local residents buying property in the SAR was lowered to no more than 4.25 percent from 15 percent.

The favorable adjustment for non-residents also benefited Chinese mainland buyers, who have shown great interest in the SAR property market. For example, Yicai learned from a group chat for mainlanders interested in buying properties in Hong Kong that four groups of people visited the SAR since the adjustments were implemented as of yesterday.

But there are still some fund transfer restrictions for Chinese mainland residents buying properties in Hong Kong. According to the Regulations of the People's Republic of China on Foreign Exchange, mainlanders are entitled to an annual foreign exchange purchase quota of USD50,000.

This means it would take several years for a Chinese mainland household to transfer enough funds to buy a residential property in Hong Kong.

The Chinese mainland residents buying property in Hong Kong usually have employment or educational needs in Hong Kong or existing investment plans. There are only a few impulsive buyers, an industry insider told Yicai.

Editors: Dou Shicong, Futura Costaglione