Currently, developers can force a compulsory auction to purchase the remaining stake of a building over 50 years old and the developer already owns 80 percent of land titles within that building.

Sources said Chief Executive Carrie Lam Cheng Yuet-ngor will announce in her last policy address of this term to lower the threshold to 70-75 percent.

The lowering of the threshold is expected to help urban renewal and speed up developers’ acquisitions as it could avoid “holdouts” -- households refusing to move and bargain for higher compensation during acquisition of properties.

“Developers will often encounter one or two ‘holdouts’ while acquiring old buildings, and the whole project therefore could not cross the threshold and force a compulsory auction, thus the reconstruction will be delayed endlessly,” a source said.

Ground floor shops usually are the holdup, as their floor area is more valuable than the residential units above them and hold more land titles of the building as well.

“The reconstruction will be delayed when shop owners refuse to move out or bargain for an unreasonable amount of compensation while developers are trying to acquire the building,” a source said.