House prices to be treated cautiously
There are good reasons why Leung Chun-ying campaigned under the slogan 'seeking change while preserving stability'. Having inherited a wealth of problems from the outgoing government, such as the widening income gap and unaffordable property prices, the chief executive-elect has to take on the challenges, set new targets and deliver. The recent gestures to increase land supply are therefore welcome. Reforms, however, often come with unease. It is imperative that the pace of change be acceptable to stakeholders.
The series of housing, land supply and urban renewal initiatives recently announced by Leung and the government were hardly a coincidence. They include revised plans to speed up development on Lantau and in the New Territories. Separately, more industrial buildings are to be flattened to make way for public housing. The commitments are the clearest signal yet that housing will be one of the new team's top priorities. Although some projects will not be completed until 2031, the determination shown by Leung will boost the confidence of many who are hoping for stronger measures to bring house prices back to an affordable level.
It is encouraging to see the new government taking steps to increase housing supply. The measures, however, appear to be too aggressive for property developers. Speaking to this newspaper, Stewart Leung Chi-kin, the executive committee chairman of the Real Estate and Developers Association, called on the new leader not to flood the market with subsidised housing units. He urged him to 'leave some space' for private developers to survive. Given any attempt to reduce property prices may affect the interest of developers and home owners, the unease is understandable.
Leung has community support in tackling soaring property prices. What he needs is to do it at a pace acceptable to the stakeholders.
Now that public expectations for a better housing policy have been raised, Leung has to deliver, with sensitivity and caution.