The number of documents delivered for land registration and searches of land registers in 2023/24 financial year fell by 12.6 percent and 10.2 percent, respectively, from the previous FY largely due to a soft property market in Hong Kong, according to official data.

Total 364,265 land documents were delivered for registration while 4,939,798 searches of land registers were recorded, the Land Registry said in its Land Registry Trading Fund (LRTF) Annual Report 2023/24 released on Wednesday.

While the LRTF operating cost was HK$452 million, it generated a revenue of HK$415.9 million during the FY, when 129 owners’ corporations were registered with the Land Registry.

“Due to an overall decrease in business volume of registration of documents, searches, copying, reports on title and e-alert services, the LRTF recorded a loss from operations (i.e. before interest income) of HK$36.1 million and a negative return on fixed assets of -10.5 percent for the financial year ending March 31, 2024,”  Land Registrar Joyce Tam said in a statement.

After taking into account interest income, the LRTF achieved a profit of HK$18.3 million, she added.

ALSO READ: City land sales hit HK$2.7b, still far short of HK$33b annual target

In past decades, the city relied heavily on land sales and other property transactions to fund its local residents’ social welfare programs, such as transportation and healthcare subsidies. This revenue once accounted for a lion’s share — up to one-fifth — of the government’s coffers, but dwindled to HK$19.6 billion, or 3.5 percent of its total revenue, in the last fiscal year, when the government’s deficit ballooned to HK$101.6 billion.

In September, the property deals for new and lived-in homes, offices, shops, car parks and industrial space tumbled 18.7 percent month-on-month to 3,843 units, according to data released by the Land Registry on Oct 3. Of these sales, 2,848 were for residential units, marking a 22.1 percent fall from August.

ALSO READ: Hong Kong sees 18.7% drop in property sales

In his budget speech at the beginning of the year, Financial Secretary Paul Chan Mo-po had said he expected revenue of HK$33 billion from land sales in the 2024-25 fiscal year, which runs from April 1 through March 31.

But data revealed on Oct 4 on the government’s third-quarter land-sale program showed that the HKSAR government had generated just HK$2.7 billion ($347.8 million) in land sales so far this fiscal year, far below its full-year target.

This figure however doesn’t reflect the actual revenue to date, as several cases were still being processed, Secretary for Development Bernadette Linn Hon-ho said on the same day.

In his third Policy Address, Chief Executive John Lee Ka-chiu announced relaxing the maximum loan-to-value ratios of mortgage loans to 70 percent for all home purchases, while easing the maximum debt servicing ratio to 50 percent for all home purchases. 

READ MORE: Reform, livelihood focus of CE's third policy address

The changes are expected to make it easier for young people to produce the necessary down payment for purchasing a flat.

In her statement on Thursday, Land Registrar Tam also said the Land Registry is working on an amendment bill on the Land Titles Ordinance (LTO), which it aims to introduce before the Legislative Council in the first quarter of 2025. The title registration system under the LTO aims to provide better assurance and greater certainty of property titles and simplify conveyancing procedures.

The Land Registry is working with the Digital Policy Office and the Hong Kong Monetary Authority on land data interchange through the secure data gateway of the government and the HKMA to facilitate enhancement of banking services, she said, adding that the initiative is targeted to be implemented progressively in 2025.