The property market heated up again in the city recently because some potential home buyers were worried about the inadequate supply of new homes in the near term. However, people of vision understand that there are more new homes in the pipeline, Cheung said during a radio program on Wednesday.

Indicating that the government also hopes to solve the problem as soon as possible, Cheung advises Hong Kong people to consider factors including their affordability, the external economic environment as well as the possibility of interest rate hikes before purchasing properties in the city.

In December, 2012, The International Monetary Fund warned that the sharp run-up in Hong Kong's home prices raises the likelihood of an abrupt correction after prices had doubled from the trough in 2008.

Property prices that rose 20 percent in 2012 had posed "a severe risk to the domestic economy" as half of the outstanding loans in the city were based on real estate as collateral, according to the IMF.

The latest Centa-City Lending Index (CCL) that measures overall local secondary residential property prices increased slightly by another 0.28 percent to 115.93 over the week ended Jan 18 from the previous week, the highest level in the past eight weeks, according to data released by Centaline Property Agency.

Wong Leung-sing, associate director of research at Centaline, expected the overall home prices to climb further in the following weeks as the Policy Address won't help much in reining in the price hike in the city.

But the effects of the Policy Address on home prices will only start to reflect on the CCL data that will be released in early February, according to Wong.

(HK Edition 01/24/2013 page2)