Public, private flats output set to hit 200,000 in 5 years
The Hong Kong Special Administrative Region Government will leave no stone unturned in its unrelenting efforts to resolve the city’s acute housing woes, vowing to get to the bottom in increasing land supply, with nearly 200,000 public and private residential units due to be completed over the next five years.
Financial Secretary Paul Chan Mopo, in presenting the 2019-20 Budget on Wednesday — his third since taking office — also ruled out scrapping existing measures to cool the local property market, saying current home prices are still well beyond the reach of many residents.
“I will ensure that adequate resources are provided to support fully the short, medium and longterm measures to increase land and housing supply,” he said.
Noting that although residential property transactions and prices have declined in the latter half of last year, Chan said local flats remain unaffordable to many people.
“The government does not intend to withdraw any demand-side management measures at this stage.”
The financial chief also warned members of the public to carefully assess the risks and their own financial positions before deciding to buy a home amid slower global economic growth and geopolitical uncertainties.
To alleviate the housing problem of those living in inadequate accommodation, the government will set aside HK$2 billion ($255 million) this year to support non-governmental organizations in constructing transitional housing for those queuing up for public housing, Chan said.
The Transport and Housing Bureau has set up a task force to look into the matter, and will make the necessary arrangements and seek funding approval later.
Government sources revealed that more than 10 NGOs have submitted their applications, with about 4,000 transitional housing units expected to be generated, based on the construction cost of HK$500,000 per unit.
“But, whether adequate land can be found or whether the NGOs are willing to take on the projects tend to be major stumbling blocks to the government’s efforts,” the sources added.
The SAR government also plans to further optimize the use of government land in the 2019-20 Budget, saying that about HK$22 billion will be used to take forward the first batch of projects under the “single site, multiple use” initiative.
For residential property, Chan explained, it’s estimated that some 100,400 public housing units will be completed in the next five years — a slim rise compared with the last fiscal year — and about 93,000 units of first-hand private residential property in the next three to four years — lower than the previous figure of 97,000 units.
Alva To Yu-hung — vice-president of Cushman & Wakefield — welcomed the government’s efforts and determination to solve the housing problem for the lower-income group.
But, he does not expect the increase in the public housing provision to have a big impact on the private property sector, saying the two markets are separate.
The 2019-20 land sale program comprises 15 residential sites, including seven new sites, railway property development projects, Urban Renewal Authority projects and private development or redevelopment projects, with an estimated capacity to generate a total of about 15,500 units.
For commercial land, the government plans to roll out seven commercial sites capable of providing 814,600 square meters in floor area — higher than the last financial year’s 530,000 square meters.
Charles Chan Chiu-kwok, managing director of Savills Valuation and Professional Services, told China Daily the increase in commercial and industrial land supply is related to the economic development of the Guangdong-Hong Kong-Macao Greater Bay Area.
“The focus will be on the site near the high-speed rail station and another in Kai Tak. This will also help bring to life new commercial clusters in Kowloon East and West Kowloon and offer more office locations for corporations,” said Marcos Chan, head of research at CBRE Hong Kong.
Given the ample financial performance of the Hong Kong Housing Authority in the next few years, and taking into full consideration the government’s financial position, he said this should bring the housing reserve, which has amassed HK$82.4 billion so far, back into the fiscal reserves over four financial years.