Compulsory sale does not benefit owners
I refer to the letter by Holden Chow of the Young Democratic Alliance for the Betterment and Progress of Hong Kong ('DAB has never neglected interests of the poor in society', March 28). It is Mr Chow who makes 'groundless and misleading' statements not Martin Brinkley ('Wealthy DAB has shown its true colours in defence of tycoons', March 21) in their discussion on the compulsory purchase ordinance.
Can Mr Chow explain how owners of flats more than 50 years old have extra opportunities to sell their flats just because a developer has the power to force them to do so? If an old man who is 'burdened by high maintenance costs' wants to sell to someone who can afford to buy, let him do so, without this ordinance shifting the balance of bargaining power against him.
Why should that same old man, who might want to live in the home he has occupied all his life, and who is worried about having to find a suitable new place to live, be compelled to sell?
And how does a compulsory sale improve the price that old man would get? When the developer has already acquired 80 per cent of a building, as the new law provides, compulsory sale does the opposite: it worsens the price he would otherwise get.
It is clear, in economic theory and in the reality of the Hong Kong property market, that the added value of development emphatically does not go to existing owners, but to the party with the capital and skills to develop the site - namely the developer.
Paul Serfaty, Mid-Levels