Chief Executive Leung Chun-ying announced a HK$1 billion plan to build 3,000 hostel units where young people could live for a limited period, to address their need for independent housing.
Leung said his scheme enlarged a proposal raised by his predecessor, Donald Tsang Yam-kuen, while adding a construction subsidy.
Critics faulted the new plan as too expensive and generous, with some doubting that young people were the most deserving of taxpayers' aid.
'I am pleased to see many non-governmental organisations willing to use land granted to them earlier to build youth hostels, to let young working people have their own living space,' Leung said.
'The government proposes to fully subsidise the construction costs for these NGOs.'
Single people between ages 18 and 35 will be eligible if they earn no more than HK$17,000 per month and do not own property.