Hong Kong can beat the property price spiral by building homes in old urban areas
I am writing in response to Jojo Wong’s letter (“Old urban areas ripe for redevelopment”, August 20).
Ms Wong pointed out that the government should implement initiatives to increase housing supply and solve the problem of rising property prices. I agree with her view that measures like expanding redevelopment projects in older urban areas should be employed to tackle spiralling property prices.
Firstly, your correspondent is spot on when she says that the acute problem of soaring prices adversely affects social stability, with young adults facing the gloomy prospect of being unable to afford their own home. According to JIJIS, an online jobs portal for employers and university students, the starting salaries of fresh graduates this year range from HK$10,000 to HK$14,000, up by 2 per cent compared with 2016. Just compare that rise to the surge in property prices during that time, and any dreams of buying a flat are destined to remain wishful thinking. Moreover, the ever-increasing number of applicants for public housing means they have a slim chance of getting subsidised flats as well.
Surging property prices will also worsen intergenerational poverty, with detrimental effects on society. Professor Wong Yue-chim, chair of economics at the University of Hong Kong, pointed out that families that do not own homes usually have a higher divorce rate than those who do, because the opportunity cost for them to get divorced is lower. Not only is it far more difficult to raise children in a poverty-stricken single-parent family, it is a tall order also for the children of the next generation to increase their social mobility and status, thus sowing the seeds of intergenerational economic inequality.
I agree with Ms Wong that redevelopment projects should be expanded to older urban areas to increase housing supply. I do reckon that this measure would be practical and beneficial.
There are over 9,700 buildings aged 50 years or above in Hong Kong’s older urban areas, and about one-third of them are in bad condition. Not only can we prevent these old buildings from collapsing and posing a threat to our citizens, we can also have our city rejuvenated by replacing these buildings with new housing estates.
This would be very effective in terms of improving our city’s infrastructure, creating a more modernised city landscape and, most importantly, further increasing housing supply.
The aggravating problem of soaring property prices is no laughing matter. As actions speak louder than words, I sincerely hope that the government can roll out different effective initiatives to address the problem soon, so that our city can hope for an end to the gloomy times.
Tina Lam, Sha Tin