Quick fix for Hong Kong housing problems: ease mortgage loan caps
- To help the middle class, the government should regularise its ‘Starter Homes’ scheme, and make it easier for first-time buyers to make a down payment
A residential project under the “Starter Homes” scheme, eResidence in Ma Tau Wai Road, is inviting applications until late January. The selling price of the 450 units is set at 62 per cent of the market price (“Buyers unimpressed by size of 'starter home' flats despite huge discount”, January 3).
The Starter Homes scheme, which was proposed in the 2017 policy address, targets the “sandwich class”, aiming to help them achieve home ownership against the backdrop where they could not afford private housing and yet earned too much to be eligible for public rental housing.
Most of the units in the development are studios or one-bedroom flats, and while the smaller flats have no space for a washing machine, residents will have access to a shared laundry.
The development is attractive to the middle class because of its reasonable pricing and convenient location, although the units are seen as a bit small for families.
Moreover, buyers for the development can borrow up to 90 per cent from the bank on a mortgage, which significantly lowers the down payment they need to make.
A downward trend in the property market has been observed recently, which I hope will benefit those waiting to own a home. But I also urge the government to loosen the cap on home mortgage loans so that first-time buyers are better able afford down payments.
Daniel Hui, Sha Tin