FLATS going on sale today under a government scheme to provide affordable accommodation are too expensive for their potential buyers. The flats have a top price of $1.62 million, despite a record 48 per cent discount on market value. Housing watchdogs say the pricing of the latest batch of Home Ownership Scheme flats flouts a government initiative to suppress the overheated property market, where prices have reached $105,000 a square metre. The Housing Authority expects to generate a net profit of $3.5 billion from the sale of 4,606 flats in four projects in Kwai Chung, Fanling, and Chai Wan. Prices reach $1.6 million for a 77-square-metre unit in Kwai Chung. Most flats in central locations are priced between $1.1 million and $1.4 million. About 1,500 flats are for buyers with incomes less than $22,000 a month while the rest are reserved for public tenants who are not subject to the income limit. For half of the 2,340 flats in urban areas, buyers with incomes of $22,000 would have to spend more than 40 per cent of their earnings on a monthly mortgage, according to the authority. In real terms, a buyer would have to pay $12,500 on a monthly mortgage for 20 years for the most expensive flats, given the authority-guaranteed 90 per cent mortgage at the prevailing 8.5 per cent bank rate. Assistant director of housing (applications and home ownership) Anthony Hui Chee-chung admitted buyers might find the flats too expensive and that their living standards would suffer to meet the mortgages. But Mr Hui said people could choose smaller flats or flats in the New Territories. The department's chief estate surveyor Ho Chin-chiu maintained the pricing was reasonable and there was no need for the department to make all its flats affordable to eligible buyers. Hong Kong People's Council on Public Housing Policy spokeswoman Virginia Ip Chiu-ping said the authority's reasoning was contradictory. ''They said a 48 per cent discount could be helpful to buyers and now they admit prices of their urban flats are beyond reach of buyers,'' said Ms Ip. She accused the authority of ''choosing to forget'' the original policy of helping sandwich-class families to own flats and changing it to make money. Her views were echoed by the scheme's flat-owners' association chairman Chow Yick-hay, who said: ''The big discount is only an illusion and the authority should price the flats at cost.'' Applications will close on April 28 and successful applicants will be drawn in a ballot next month.