(Bloomberg) -- Hong Kong will loosen mortgage rules on homes and slashed the tax on spirits as the government seeks to stimulate an economy impacted by China’s slowdown.

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The maximum loan-to-value ratio for properties will be set at 70% for all homes, the city’s leader John Lee said on Wednesday as part of his annual policy address. He also broadened an investment immigration program to include homes as qualified assets.

Home prices have tumbled to an eight-year low due to plunging demand by mainland Chinese and elevated borrowing costs. Analysts didn’t expect the measures to have a notable impact on the market, which is facing a 20-year-high backlog of unsold properties.

“Both measures are expected to boost transaction volumes, especially for new residential projects, but are not strong enough to reverse the downward trend,” said Joseph Tsang, chairman of JLL in Hong Kong.

To help stimulate nightlife, Hong Kong reduced the duty on imported liquor priced above HK$200 ($26) to 10% from 100%, which was among the highest rates in the world.

The move is the latest by the government to rekindle sales for restaurants, bars and retailers, which have been struggling due to fewer tourists post Covid and a slowdown in domestic spending. Retail sales have fallen every month since March on a year-on-year basis, while restaurant takings in the three months to June were below 2018 levels.

Lee said in his address the government asked Beijing to allow more visits by mainland residents, who make up the overwhelming majority of arrivals.

Easing rules on mainland tourists is unlikely to be enough to help the city’s retailers, according to Billy Leung, an investment strategist at Global X Management in Sydney.

“There’s a lack of meaningful incentives for mainland travelers to visit and spend in Hong Kong,” said Leung. “There’s still no real consumer confidence, and spending remains weak.”

Lee, who took up his position in 2022, has shifted focus to boosting the economy after the government passed national security legislation earlier this year.

The latest housing measures add to efforts to boost the real estate market, including by removing most home purchase curbs and cutting property buying taxes. While these moves triggered a brief rebound, prices resumed their decline.

The broadened investment migration program will include homes valued at HK$50 million or above as part of the required HK$30 million investment. Previously excluded, such property purchases would fulfill a third of that requirement.

The Hang Seng Index ended the day 0.2% lower.

--With assistance from Shawna Kwan and Sangmi Cha.

(Updates with market reaction, comments and more details)

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