Chief Executive Carrie Lam Cheng Yuet-ngor described the housing sector as the “top priority” of governance in many of this year’s Policy Addresses. However, in a recent interview on a TV program, she seemed to expose her mistakes in understanding the status quo of housing, which made people question her and Whether the government can achieve the primary goal of housing policy for citizens to live in peace.
In the interview program broadcast this Friday (November 5), Lam Cheng mentioned that the government should increase the supply of housing in the short, medium and long term, but he does not think that the government should have special policies to curb the value of land.
She pointed out that "Hong Kong’s housing market is divided into two, and 70% is the government’s actions. We will try our best to provide land to (build) different types of houses to meet the housing needs of families with different incomes and assets. Thirty, many people like to come to Hong Kong to buy properties. We also provide more land. We hope that through a sufficient supply, property prices will not be pushed too high or too fast."
These remarks may reflect that she has some misunderstandings about the current actual housing distribution.
Not to say too far, public housing accounts for only half of all housing after the reunification. According to the Housing Statistics 2021, the ratio of public rental housing plus subsidized sale units last year was only about 45%, and private permanent housing accounted for about 54.2 %.
As of March this year, the corresponding number of units was 1.272 million and 1.641 million.
The actual proportion of public housing has never reached 70%
The 70% mentioned by Carrie Lam believes that starting from 2018, the Government’s Long Term Housing Strategy has raised the proportion of public housing units in the ten-year housing construction target from 60% to 70%.
The Secretary for Development, Wong Wai-lun, stated last month that 350 hectares of land has been found in the next ten years, and about 330,000 public units can be built to meet the demand for about 301,000 units. As for the 170 hectares of land reserved for private units, it is expected that more land will be added. There are 100,000 units, and the proportion of public housing is 76%.
A rough estimate is that even if all about 431,000 units are completed in the next ten years, the number of public housing units will only increase to 1.602 million, which is still lower than the 1.741 million of private units, that is, the public sector ratio will not exceed 50%.
Furthermore, the government did not claim until last year that it had found the land needed for public housing in the next ten years, and it would not be possible to build it until the second half of the ten-year period. This shows that this situation is still difficult to change in the short term.
Based on the above figures, the 73% ratio in the housing market in Hong Kong has not yet been achieved. The extremely large amount is just evidence of the government's current allocation of land and housing.
What is worrying is that if Carrie Lam believes that the current housing market is already at a ratio of seven to three, it means that the government is just "talking about it as doing it" and has not really grasped the reality.
Reducing the proportion of private housing does not necessarily increase the price of private housing
If the government is to set housing as its primary housing policy goal, the government should mobilize more land to build public units in the next ten years, so that people can rent and buy units at affordable and predictable prices.
According to this objective, the ratio between public and private entities is not aggressive enough, and the ratio between August and September is the more reasonable direction.
Only by substantially increasing the public sector ratio can the situation of subsidized sale of flats and land "snatching away" public rental housing units and land will be avoided, and the demand for rental housing and self-purchasing will be met at the same time.
In addition, as long as public housing is widely built and the public and private housing market is divided, the public will not have to rush to "get on the car," nor will they worry about the price of second-hand public housing being pulled up by the private market.
Key points of the 2018 policy address: The ratio of public-private housing will be changed from 6-4 to 7-3 in terms of housing units.
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Looking at neighbouring Singapore, the ratio of public-private housing is really seven to three. The number of HDB housing accounts for more than 70% of the country’s housing, and private housing is less than 30%.
The government controls the purchase of HDB flats by non-locals, and also evaluates and meets future needs in the form of pre-sale HDB flats.
Although the prices of private buildings in the country are equally expensive, and the resale price of HDB flats has risen by about 75% in the past 15 years, the price of new HDB flats is still controllable and the public still has plenty of opportunities to "get on the bus."
The current government allocates 70% of the new housing supply to public housing. This is indeed an improvement over previous governments, but the government must know that the housing ratio of 7 to 3 has never been achieved.
Furthermore, precisely because successive governments have suppressed public housing production, the effect of the 7:3 ratio can only slightly increase the overall public housing ratio in Hong Kong. Carrie Lam must not regard it as a panacea.
The government has more tactics to offer, such as further increasing the proportion of new public housing, introducing a vacancy tax on first-hand properties, and stopping the flow of new subsidized-sale flats out of the free market.
With so many tricks, how can the people be convinced that the government is determined to let the people live in peace?
Waiting time for public housing has reached a 22-year high