Chief Executive Carrie Lam Cheng Yuet-ngor hopes that the Green Form program, which caters especially for public-housing tenants and will work in tandem with the “Starter Homes” program, could be regularized to ultimately replace the traditional public rental housing units. (PHOTO PROVIDED TO CHINA DAILY)
In such an overcrowded city billed as the world’s least affordable place to live in for the seventh consecutive year, it’s no surprise to see the housing problem emerge as one of the most pressing social issues in Chief Executive Carrie Lam Cheng Yuet-ngor’s maiden Policy Address.
In a sign of her fledgling administration’s resolve to rein in the city’s ever-escalating property prices and tackle a years-long housing crunch, Lam came up with a new bout of policies aimed at erecting a housing ladder that would be easier to climb for those who have been priced out of the market for so long.
The “Starter Homes” pilot program — a project Lam pledged to carry out during her election campaign — emerged as one of the highlights of her short, 40-minute speech on Wednesday.
Whether the new policies could make all the difference still relies on the long-term feasibility and how far the government could go to put them into practice
Thomas Lam Ho-man, Hong Kong-based head of valuation at Knight Frank
The plan to sell subsidized apartments is aimed at helping the city’s young and first-time homebuyers — the so-called sandwich class who earn too much to qualify for purchasing the traditional government-subsidized apartments, and yet unable to afford private apartments — to get on board the market.
Under the new program, details of which will be announced in the middle of next year, the upper income limit for applicants will be capped at HK$34,000 a month for singletons and HK$68,000 for households with two or more members.
“The upper limit of household income turns out to be far higher than the median income of households in the private housing market, which currently hovers at around HK$36,600,” said Sharmaine Lau Yuen-yuen, chief economic analyst at mReferral Mortgage Brokerage Services in Hong Kong.
“This makes only 10 percent of the city’s working population eligible for the pilot program. So, you may not blame people for questioning to what extent the program could lift those with the most pressing need to get onto the housing ladder,” said Thomas Lam Ho-man, Hong Kong-based head of valuation at Knight Frank.
Land for the “Starter Homes” will come from sites already owned by private developers, or those to be bought from the government, according to the Policy Address.
Alnwick Chan Chi-hing, Hong Kong-based executive director at Knight Frank, believed that public-private partnership is a reasonable approach that’s also in line with the interests of private developers, who want to develop their land reserves at a lower land premium in exchange for setting aside a number of flats for the program.
Carrie Lam also placed high hopes on the Green Form Subsidized Home Ownership Pilot Scheme that allows and induces the city’s 756,000 public-housing tenants with sufficient means to become homes owners to vacate their units for those on the waiting list — a queue that would normally take them about five years to clear.
The chief executive hopes that the Green Form program, which caters especially for public-housing tenants and would work in tandem with the “Starter Homes” program, could be regularized to ultimately replace the traditional public rental housing units.
“In the long run, regularizing the program could ease the burden of the government and allow it to utilize its resources more efficiently on public-housing development,” said Vincent Cheung Kiu-cho, Hong Kong-based deputy managing director of Asia valuation and advisory services at Colliers International.
“By and large, the efforts to make Hong Kong affordable are in the right direction. But, since the housing problem has long been a tough nut to crack, whether the new policies could make all the difference still relies on the long-term feasibility and how far the government could go to put them into practice,” Thomas Lam said.