In the face of Asia's economic downturn, the Government should adopt a more flexible housing policy and place less emphasis on its goal of 70 per cent home ownership, according to John Hui Wing-to, vice-president of the Hong Kong Institute of Real Estate Administration. It should concentrate instead on building more rental accommodation to meet the housing needs of new arrivals and the many Hong Kong people living in cramped conditions. 'I am not saying that Government should reduce the amount of housing it is building, but it should reduce the amount of subsidised housing for sale, like the Home Ownership Scheme and the Private Sector Public Participation [scheme],' he said. New arrivals from the mainland, newly married couples, divorcees, returning immigrants - the bulk of the projected increase in population would not be able to afford government-sponsored home ownership flats, he said. Nor would the bulk of tenants wanting to make the jump to home ownership. Hong Kong people could expect little or nothing in the way of salary increases and bonuses for the next couple of years, because of the economic downturn, he said. The institute said it could take residents three to five years to recover their purchasing power and be able to buy government flats. 'There is no hurry for home ownership, but there is a demand for rental accommodation,' Mr Hui said. Recently, there had been a large drop in the number of people applying to buy government-sponsored housing, for which he blamed the economic downturn and the increasing number of layoffs and closures. Mr Hui said the Government should take a further look at its goal of providing 85,000 flats per year. Under the original plan announced last year, the Government was to provide 50,000 units a year and private developers 35,000. However, the economic downturn affecting Hong Kong would delay the ability of developers to meet the Government's target, Mr Hui said. Developers already were hampered in reaching their targets due to a variety of administrative delays, a lack of land, as well as several other impediments, he said. Recent increases in interest rates and lacklustre buying sentiment meant developers also would be less anxious to bring flats to the market. Sun Hung Kai Properties and Henderson Land Development already had announced they would postpone some future projects as a result of the economic turmoil and the slump in the property sales market. The Government should not try to force developers to bring a specified number of flats to the market if there was no demand, Mr Hui said. He said he had no projections on the number of flats developers would be able to produce, but said the Government would miss its target of 85,000 by between 20,000 and 25,000 units a year. Last year, developers had built about 18,000 private dwellings, which was about 20 per cent less than had been anticipated, he said. Mr Hui said he expected a larger shortfall in production this year due to construction-related delays. He was not sure whether developers would be able to make up the shortfall in the long term. 'It really depends upon the economy,' he said.