Target for construction of public rental flats too low, adviser says

Consultant says government needs to build nearly 25pc more homes than planned by 2022

PUBLISHED : Thursday, 20 June, 2013, 12:00am
UPDATED : Thursday, 20 June, 2013, 4:19am

A consultant advising the government on housing policy says that to meet growing demand it will need to build 221,800 public rental flats over the coming decade. That's almost 25 per cent more than the current construction target.

The consultant forecast demand for new private flats in the range of 128,700 to 191,000 over the same period.

The government's Long-Term Housing Strategy Steering Committee will meet today to discuss - and possibly amend - the projections, which were submitted to it recently in confidential papers. It will also discuss whether private developers should be invited to build subsidised housing to ease the burden on the government.

"The figures are not yet finalised. Members are likely to challenge the assumptions behind them," a person familiar with the committee's work said. "For example, the consultant did not count demand from thousands of mainland university students, who flock to rent private flats near their campuses because they cannot get a place in student dormitories."

The committee, set up by Chief Executive Leung Chun-ying, is expected to deliver advice to the government this summer about how many public- and private-sector flats should be built in the next 10 years. It is likely to suggest a range of figures rather than an exact number. Officials will make a decision after a public consultation.

The consultant, who has not been identified, has been assessing future demand by taking into account population growth, marriages, people who need to be rehoused as a result of urban redevelopment, and people who live in poor conditions and need better housing.

The government has targeted the construction of 79,100 public rental flats by 2017 and a further 100,000 between 2018 and 2022 - a total of 179,100. That's 42,700 lower than the consultant's estimate of the number required.

A committee member said the assumptions were based on prevailing public housing policy. If the policy was changed - for example, if single people aged over 35 but not classed as elderly are to be given a flat within three years of applying, as family applicants are - the projected demand would be even higher, he said.

If the consultant's higher estimate for the number of new private homes needed - 191,000 - is correct, developers will have to build an average of 19,100 a year. That's a lot more than they are currently building; last year, 10,100 new flats were completed by private companies.

Another committee member said the projection for private flats was also likely to be revised. As well as taking into account demand from mainland students, the consultant may be asked to reassess the size of the group needing rehousing, for instance.

"The consultant may have underestimated the problem of subdivided flats. They think only those living in a subdivided flat without its own toilet and kitchen deserve better conditions," another member said.

A University of Hong Kong study commissioned by the government recently estimated that more than 170,000 people live in subdivided flats.