How Hong Kong's public housing enhances people's well-being

Chief Executive Leung Chun-ying renewed his pledge to rebuild the housing ladder and play a more active role through the provision of public housing to tackle soaring property prices and rent, following the veto of the electoral reform proposal. Indeed, the provision of public housing provides an important buffer for low-income families. Renting privately is unaffordable to many, and the prospect of buying is remote at best, given that it would take the average person more than 14 years of saving every cent to afford an average-sized home.

Hong Kong offers an interesting Asian case study, since the city is highly connected to the global economy and shows similar trends to other world cities with regard to housing scarcity and urban inequality. Public rental housing constitutes the largest part of our public housing programme. Hong Kong currently operates the largest public housing system among cities in the capitalist world. More than two million residents live in public rental-housing (30 per cent of the population) and nearly 1.4 million (17 per cent) in subsidised home ownership flats.

In its 2013 report, the government stated that support from its provision of subsidies (mainly in the form of public housing) has led to a reduction in the overall poverty rate, from 14.5 per cent to 9.8 per cent. Scholars examining housing here point out that the city's success and position in the global economy are partly a result of the extensive public housing programme, which contrasts sharply with the laissez-faire policy regime that Hong Kong is often associated with.

Furthermore, when factors such as social fragmentation, the number of elderly in an area and district income levels are taken into consideration, living in public housing can actually reduce a person's risk of dying early.

There are other benefits, too. First, public housing estates in Hong Kong are usually properly maintained and managed by the Housing Authority. The associations in Western studies between public housing and health disadvantages may be due to the poorer conditions of the estates themselves. This underlines the importance of not only delivering public housing, but also maintaining and improving the stock - showing that a rethink is needed in the debates on public housing in some Western cities.

Public housing should also be seen as an in-kind benefit that represents a transfer from market-level rents to subsidised rents. This indirectly increases households' disposable income and potentially expands material assets relevant to people's health and well-being. In addition, the Home Ownership Scheme has enabled households to directly accumulate capital within the public housing sector. Those who own their property under the scheme are allowed to resell to those eligible for public housing, or pay the land premium cost and sell on the open market.