My Take | Transparency needed in housing scheme
Chief Executive Carrie Lam was quick to dismiss a claim that her proposed Starter Homes scheme was just a way for the government to collude with property developers. Presetting flat sizes and prices is one way to allay such suspicions
The devil is in the numbers. During a radio interview after her policy speech, Carrie Lam Cheng Yuet-ngor rebutted a caller who warned her proposed Starter Homes scheme was just a way for the government to collude with property developers in the name of helping middle-income people to get on the home ownership ladder.
The chief executive quickly dismissed the claim as another one of those conspiracy theories inevitably spread among the public with any big government plan. Well, it all depends on how much developers stand to gain from such private-public development projects.
Lam subsequently softened up by clarifying that crucial details have yet to be worked out and will be subject to public consultation. These include pricing, flat sizes and restrictions on owners’ ability to resell them. I would add one more condition: transparency, that is, make developers open their books with such development projects.
When companies get involved, they are no longer purely private profit-seeking machines any more. In effect, so far as those projects are concerned, they have become something like public utilities such as old-fashioned banks and power companies like HK Electric and CLP Power.
Developers should have no trouble understanding this concept, since two of the biggest developers in Hong Kong control our power duopoly; and the profits of both power utilities are dictated by the government’s scheme of control, which is pegged to the value of their fixed assets.