Hong Kong’s biggest headache is not only finding land, but also building affordable housing
City’s problem of soaring property prices cannot be solved just by supplying more land, and public consultations are unlikely to reach an easy consensus
What is the most haunting nightmare for our government? Not independence advocacy, not even those always critical pan-democratic politicians, but housing, perhaps.
The city’s housing shortage is an obvious political time bomb which can cause serious damage, socially and politically, if not properly defused. It is also a key benchmark Beijing now uses to assess the competence of the city’s administrative team.
Taking reference from the lessons learned after all the difficulties and resistances her predecessor Leung Chun-ying encountered over the past five years, Chief Executive Carrie Lam Cheng Yuet-ngor wisely appointed a task force to forge public consensus. Now comes a massive, citywide consultation on where and how to find land.
The sky is the limit for runaway property prices in Hong Kong. To make matters worse, while building micro flats has become the new trend under the excuse of making housing more affordable, the hard truth is that prices per square foot actually keep soaring.
Affordability has become an illusion for many, especially young people.
It doesn’t make much news nowadays when a studio-style flat measuring less than 200 sq ft can cost more than HK$4 million or HK$5 million. Prices for relatively luxurious flats can be as high as HK$40,000 to HK$50,000 per square foot, depending on their location.
But it gets worse if you find the private property market unaffordable and turn to the supposedly cheaper alternative of government-subsidised housing meant for low-income groups.
In a jaw-dropping phenomenon, the crazy prices have spread to this completely different housing market without people realising. Just last week, a 443 sq ft public housing flat, built 29 years ago in the Northwestern New Territories’ Tuen Mun district, sold for more than HK$4 million!
Now that the task force has finally kicked off a longer than usual five-month public consultation offering 18 options, a long-asked question has popped up again: “Can housing affordability be resolved by supplying more land?”
There is no easy answer, apparently. Stanley Wong Yuen-fai, head of the task force, admitted there would not be any simple solution to the scarcity of land even as he vowed to keep out all vested interests. But still, affordability is not something this task force or consultation exercise can tackle.
The reality that no one needs to be reminded of is – setting aside the fact that it is by no means easy to find more land – even with the land on hand, it still takes a long time to build enough flats to meet demand; affordable ones, in particular.
On the other hand, in a free and open market, potential buyers are not only locals but also those from across the border and overseas, who may well drive up prices.
It is against such a backdrop that the idea of building a “Hong Kong town” in neighbouring Guangdong has been raised by MTR Corporation chairman Frederick Ma Si-hang, who believes it may help those willing to commute to afford a home.
Ma’s idea may or may not be welcome, depending on who you are.
It will probably be the same for this public consultation – no easy consensus at all.
As Wong honestly stated, each of the 18 options – including the controversial ideas of converting land from country parks and a golf course – could “directly benefit or hurt” certain stakeholders. Who is to compromise?
At the end of the day, perhaps the biggest – and most ironic – consensus is that looking for land is really a tough mission.
This consultation is but just the first step. It is a matter of political will and a holistic strategy for the government.