New World Development’s social enterprise "New World Builds a Good Life" proposed the first non-profit privately-funded housing project in Hong Kong on Monday (6th). 550 square feet.
Although the society is happy to see real estate developers recruiting to ease the pressure on home ownership, land and buildings involve significant interests and government grants. Therefore, every step of the process must be more fair and open, especially the arrangements for the payment of funds and land premiums.
The social enterprise has not disclosed the specific location of the project. It also said that it is negotiating with the government on land premium arrangements. It expects to announce the details and start other urban planning procedures within the next six months to one year.
Although outsiders claim that the project is similar to the Housing Authority’s HOS, there are many differences in pricing, targets, and contributions.
Although the prices of the two are similar, and converted to a 50 to 60 discount of the market price, the new HOS housing price is based on the median household income, while the social enterprise project is based on the cost price.
Secondly, social enterprise projects have an age limit for buyers, and only Hong Kong residents and first home buyers aged 25 to 45 are allowed to purchase.
Third, the project and the HOS are also different from ordinary private housing in terms of payment. The property price will be divided into two halves. The first half can take up to 90% of the mortgage, and the buyer only needs to pay the down payment of 5%, and the rest will be spread according to the mortgage period. point.
For the remaining half, social enterprises stated that buyers need to undertake the construction once or in phases within ten years after the transaction.
Land premium determines the selling price
In terms of price alone, social enterprise projects are indeed quite attractive.
As pointed out by social enterprises, the payment method helps young buyers easily "get in the car" and also leaves time for them to increase their repayment after their income increases.
Even so, the information released by social enterprises is still quite rough and needs to be clarified.
First, in terms of the payment details, the undertaking clauses of the second half of the mortgage are not clear enough. The so-called "one-off or phased undertaking within ten years after the transaction", how long is the undertaking period?
If the mortgage is made in one lump sum from the tenth tenth of the 30-year mortgage repayment period, the remaining 20 years of repayment will be used up. Based on the total property price of 2.7 million yuan and the annual interest rate of 2.5%, the total monthly payment is about 1.21 However, if there is only a ten-year repayment period, the total monthly payment for that ten-year period will rise to 17,700 yuan.
The difference between the two is more than 5,000 yuan, and the larger the unit area, the greater the difference in repayment.
Second, developers claim that property prices are 50% to 40% off market prices, partly because social enterprise projects do not make profits and lower prices, and partly because they assume that government preferential land prices are estimated to be at least 30% to 40%.
The Transport and Housing Bureau welcomes the proposal of the social enterprise project, saying that it will help increase the supply of subsidized housing and home purchase options. However, when discussing the amount of land premium, the government will inevitably have a customary restriction, and the discount cannot be too small.
Third, whether the responsibility for free sale of land premiums should be borne by the owners.
The social enterprise announced that buyers would freely sell their units in the market "after making up for the government's land price difference" from the tenth year after they bought the units.
This clause is basically a reference to the resale restrictions of the Housing Authority and the Housing Association's subsidized housing, but the policy effects of the two are not the same.
Chen Fan said that the current subsidized housing can cater for the home ownership needs of people of all economic levels.
(Legislative Council website)
Public details as soon as possible to clarify doubts
The government originally granted land to the Housing Authority to build HOS flats at a nominal land price. The Housing Authority is a public sector, so it did not cause actual losses of public funds.
The Housing Association is a private but an independent non-profit-making organization that has been operating for many years, so there is no dispute that the government provides land price concessions to the Housing Association.
In contrast, in terms of privately subsidized housing, social enterprises have made less profits and have to set aside a large amount of funds to advance to the bank. However, as long as the buyer fulfills the contract, the social enterprise actually has no loss, at most it only loses. It could have been placed on the opportunity cost of profit-making projects.
On the contrary, the government has indeed under-collected part of the land premium income from the land rezoning by the developers, and will not be able to get it back until a buyer pays back the land price of the unit ten years later. Is it too generous to social enterprises?
The business sector has joined the ranks of building subsidized housing to reduce the housing affordability of the people. The government and society are happy to see the results.
However, the information released by social enterprises is incomplete, and there are a lot of doubts.
Some people in the market have guessed that this project is still aimed at wooing the government to repair bridges and repair roads, and promote the appreciation of the neighboring land of the parent enterprise.
Rather than making such doubts continue to grow, social enterprises should announce the details as soon as possible. The government and social enterprises should deal with issues such as land premiums in a fair and open manner.
The low tax for first home buyers is not subdivided or violates the original intention of helping home buyers?
The first time home purchase is postponed to an average of 44 years old. The cruel reality of "relying on the father" must be broken
