Villagers home in on profits

Soaring property prices have made rural land sites increasingly expensive - and highly sought-after - as indigenous villagers and developers hold on to land or snap up additional sites so they can make big profits by building village houses, property agents say.

Land prices in villages in the New Territories have risen from between HK$50 and HK$150 per square foot in 2005 to a current average range of between HK$200 and HK$300 per square foot, Dan Li Chiu-sang, project manager at Oriental Property Agency, said.

Limited undeveloped sites and better transport have lured a growing number of city dwellers to rent or buy village homes in recent years - adding to pressure on prices.

Oscar Man, 30, was among those tempted to live in the country, but his dream of being a homeowner ended in disappointment. He had agreed with a village friend to spend HK$3 million to build a three-storey house on his friend's land in Yuen Long - only for his friend to abruptly turn down the plan.

'Originally the plan was that I would pay all the construction and renovation fees for building a three-storey house on my friend's land,' Man, who is neither a landlord nor a descendant of indigenous villagers, said. 'By offering the site my friend would not need to pay a penny, but agreed to take the ground floor of the house, while I would occupy the top two storeys.'

Under the small-house policy, introduced in 1972, male descendants of indigenous people in the New Territories aged 18 or above have the right to build a three-storey house with a footprint of 700square feet in their own village. They can either apply for a licence to build a house on their own land, or obtain a private treaty grant of government land at a concessionary premium.