To manage public expectations that property prices would only go up after the third round of quantitative easing (QE3) in the United States and in a low interest rate environment, Hong Kong Government announced a 15 percent property tax for all companies and non-local buyers, and increased special stamp duties - ranging from 10 to 20 percent on resale made within three years of a home purchase, last Friday.

Although we need time to verify the measures' effectiveness, it is observed that transaction sentiment plunged not just in the new home market, but also in the secondary home market, as both markets got disappointed results over the weekend.

Obviously, this time, it is as if related participants have been well aware of the possible development in home prices after a sudden surge in market liquidity again, given the QE3.

In fact, residential property price growth slowed and transaction volumes fell, in the month and after two months of Government's announcement of housing curb on home purchases two years ago respectively, accordingly to IMF's research report.

Home owners could simply transfer the amount of special stamp duties payment to the future would-be home buyers, leading to a surge in home prices by approximately the same amount, after the market digested the news.

Of course, it is different this time as the market is rather fragile, with the US economy still struggling from its recovery path. The ongoing sovereign credit woes in the Euro areas, coupled with the the Chinese economy's slowdown makes the situation more complex. Since the Government is targeting on deflating the asset bubble risk, it is estimated that the market will stay stagnant with increasing downside risk in price in the next six to nine months.

Meanwhile, the Government has warned it will crackdown on speculation in the commercial property sector if it continues to heat up, subsequent to a rising concern that hot money will spill to commercial premises, including shops and industrial buildings, which may affect future of the territories' small enterprises.

What's more is that the Government looks to step up the curb if the latest measures fail to control speculation. It is estimated that the market will stay weak with many buyers, especially those from the mainland, adopting a "wait-and-see" approach.

At this point of time, home sellers could still sell their flats if they are willing to lower their asking prices by 5 to 10 percent, driven by robust demand. Nonetheless, it is estimated that the current average home price is still overpriced by more than 15 percent. It is highly expected that their asking prices will edge down further from the current level.

Although many people expect hot money to flow to stock markets, most of the funds could have been parked on bonds and renminbi (RMB) deposits for stable returns amid market uncertainties.

The author is vice-chairman and CEO of international property consultant Vigers Group. The views expressed here are entirely his own.