Subsidised homes in Hong Kong for lower-income families and a special project for the elderly are far too costly
Recent projects in Kai Tak and North Point are met with only a muted response as prices still range in the millions of dollars
It’s laudable so many public bodies are trying to help the elderly and lower-income families find adequate housing. But the way some go about it may not be the most effective.
So long as they insist their projects at least cover the development costs and so have to be valued at market levels, it’s really not much help.
That probably explains the lacklustre response to De Novo, a subsidised housing project in Kai Tak by the Urban Renewal Authority, and a non-subsidised elderly housing project in North Point by the Housing Society, the first of its kind in Hong Kong.
READ MORE: ‘Anything but a bargain’: prospective buyers criticise Hong Kong’s latest subsidised housing project
Prices for the Kai Tak flats, which range in size from 332 square feet to 568 sq ft, are between HK$9,734 and HK$12,414 per square foot in saleable area. The authority claims the prices are marked at a 20 per cent discount to nearby private flats.
A 20 per cent cushion offers a significant margin of safety on paper. But in a falling and volatile property market, it may not be as enticing as it first appears.
Meanwhile, the Housing Society has offered elderly people over the age of 60 lifelong rental at its development at Tanner Hill, a three-block estate in North Point.
The units are aimed at the middle class. So for HK$1.8 million to HK$20 million in rental – no ownership is conferred – elderly applicants get to choose flats that range in size from 342 to 821 sq ft.
READ MORE: Hong Kong’s first life-long rentals for the elderly project opens, but not all welcome it
But what’s the attraction to paying top rentals when you can buy and own similar flats in the private market?
Well, the buildings are specially designed for the elderly, with in-house services ranging from grocery shopping and house cleaning to medical check-ups. You have to pay extra for the services, of course.
The high costs may be one reason why only two-thirds of 588 flats at the elderly housing project have been applied for.
It does have a certain attraction for an elderly person or couple who live on their own and do not enjoy much family support or simply don’t want to bother their children.
But most people would rather own their flats if they are committing to a payment, either in a lump sum or in instalments, of millions of dollars.
Both projects intend to offer a refuge from the private property market. But the Tanner Hill scheme is far too costly even for middle-class applicants.