Hong Kong’s residential prices and rents have gone beyond levels affordable to average residents, the housing minister has admitted.
Local home prices top a list of 360 cities around the world – in the fourth consecutive year a global survey has ranked Hong Kong No 1 in terms of unaffordable housing.
“Generally speaking, the prices have exceeded what most people can afford,” Secretary for Transport and Housing Professor Anthony Cheung Bing-leung said on Wednesday in response to the study findings, released by US-based consultancy Demographia the day before.
Cheung defended the government’s cooling measures, saying the introduction of extra stamp duties in October 2012 and February last year had helped stabilise prices, but that average household income levels still lagged behind property market rates.
“When even university graduates cannot see the prospect of affording a flat, not even a new Home Ownership Scheme flat, it reflects some structural problems in our society,” he admitted, referring to a programme that provides subsidised public housing for sale.
Aspiring home-buyers could look to a government plan to build 80,000 HOS flats in 10 years, which was announced in Chief Executive Leung Chun-ying’s policy address a week ago, he said.
In the policy blueprint, Leung also pledged to build 200,000 public rental flats for lower-income families in a decade.
But housing supply would not increase significantly until the second half of the 10-year period, Cheung said.
He said the intensive construction ahead also meant the government must inevitably inject more money into the Housing Authority – which builds and manages public housing estates.
The minister stopped short of giving an estimate, saying only that the administration would allocate more funds to the authority on a large scale.
On January 7, the authority warned that its overall consolidated surplus would drop 83 per cent over four years to HK$958 million in 2018.
This projection does not take into account the plans to further increase public housing that Leung announced last week.