Does Hong Kong’s land sale system need a new lease of life?

The current arrangement stifles competition among developers and makes owning a home even more expensive, critics argue

Reading Time:7 minutes

The site in Lee Nam Road, Ap Lei Chau, for which two mainland Chinese developers paid a record HK$16.86 billion. Photo: Edward Wong

Published: 7:15pm, 18 Apr 2017Updated: 11:09am, 19 Apr 2017

The two-lane road along Ap Lei Chau’s southern coastline looks particularly gloomy on a cloudy, humid March day.

Lee Nam Road appears to have been recently resurfaced, with a slight smell of new asphalt in the air. On one side of it, Mount Johnston bares its barren, rocky face. On the other, a long, tall and drab-looking concrete wall topped with barbed wire blocks off sewage treatment facilities.

It’s a seven-minute walk down the road from the nearest MTR station to reach Hong Kong’s most expensive site since the 1997 handover in the government’s recent land sale.

Watch: Why is Hong Kong housing so expensive?

In February the rectangular stretch of land measuring 126,595 sq ft was sold to two mainland Chinese developers for a record HK$16.86 billion – or HK$22,118 per sq ft – for residential development. Sandwiched between the sewage treatment plant and an industrial area, with an open unrivalled sea view, the site was almost 50 per cent more expensive than the market’s highest expectation.

“The property market is going crazy,” said Annie Tong, a 45-year-old mother of three who lives in nearby South Horizons, a private housing estate. “It’s really unfair to young people. At such prices, when will young people be able to buy a flat?”

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