Imagine a policy that would bestow wealth on close to half the population, boost the property market and help the government offset its budget deficit, but cost little to implement.
Just sell all the existing stock of 650,000 public rental housing units to sitting tenants and allow them and the 300,000 flats built under the defunct Home Ownership Scheme (HOS) to be resold in the open market.
These units are estimated to house about three million people, or 44 per cent of Hong Kong's population. Selling them would solve, once and for all, the financial blues of the Housing Authority, which would have no need to exist. The politically charged problems of finding effective means of evicting well-off tenants and accommodating demands for bigger or additional flats from families that have outgrown their existing homes would also disappear.
The aborted listing of The Link real estate investment trust could still go ahead after the legal issues are resolved, but its proceeds would go to the government.
The ambitious sale would go a long way towards achieving Chief Executive Tung Chee-hwa's target of raising the home ownership rate to 70 per cent, a goal he set at the beginning of his term, but which has since been aborted.
The policy of wholesale privatisation of public housing is not as hilarious as it sounds. What it takes to succeed is to realise that Hong Kong's traditional bricks-and-mortar approach of providing subsidised housing to low-income households is costly and inefficient, to the government as the provider and the tenants as the beneficiaries.
