Editorial | Despite an array of other problems, keep focus on affordable housing

With prices still beyond the reach of average buyers, the government must step up efforts to enhance land and housing supply in the medium and longer terms

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Financial Secretary Paul Chan Mo-po has rightly resisted pressure to relax the property market cooling measures introduced years ago. Photo: K. Y. Cheng

Published: 9:33pm, 1 Mar 2020Updated: 11:01pm, 1 Mar 2020

Boom or slump, the property market remains a matter of public concern in Hong Kong society. Even while the city is grappling with an epidemic, there are always those who care more about the impact on market fluctuations than the health crisis itself. This is not surprising. The outbreak of severe acute respiratory syndrome (Sars) in 2003 proved that it could be the best of times as well as the worst of times, depending on whether your are a property buyer or seller.

Financial Secretary Paul Chan Mo-po has rightly resisted pressure to relax the cooling measures introduced years ago. It is true that transactions have been dampened by the double blow of social unrest and the coronavirus outbreak. But if the government were to withdraw the measures, prices might surge and speculation return, he said. Chan devoted considerable coverage to land supply and flat production when delivering his budget last week. But it also shows the government is still struggling to tackle the housing conundrum. With the government having to deal with the protests triggered by the now-withdrawn extradition bill and now the Covid-19 epidemic, there is a perception that the efforts on housing have slowed down, if not halted.

Chan pledged to closely monitor the market situation. Vigilance aside, the momentum on boosting land supply needs to pick up again. It is good to hear that an array of projects will move ahead this year, such as the Kwu Tung North/Fanling North development and the land sharing pilot scheme with private developers.

Some initiatives raised by Chief Executive Carrie Lam Cheng Yuet-ngor have yet to materialise. This includes the highly controversial Lantau Tomorrow project, under which 1,700 hectares of new land will be formed by reclamation near the outlying island. Estimated to cost hundreds of billions of dollars, the initiative faces strong political resistance. Adding to the concerns is the government forecast of budget deficits until 2025. Chan sought to allay fears of a slump, saying home prices would not “fall off the cliff”. Indeed, the government has been caught between a rock and hard place. While falling prices are in the interest of homebuyers, a sudden crash will hurt owners and destabilise the banking and financial systems.

That makes gradual adjustments all the more important. With prices still beyond the reach of average buyers, the government must step up efforts to enhance land and housing supply in the medium and longer terms. The output of the land sale programme in the coming financial year, which comprises 15 residential sites, can only produce about 7,530 flats, the lowest in 10 years. Together with private and redevelopment projects, the capacity could reach 15,730, which is still woefully inadequate.

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.css-1m2rp1p{color:#34b8b5;}Editorial | Despite an array of other problems, keep focus on affordable housing

.css-1mniedq{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;} With prices still beyond the reach of average buyers, the government must step up efforts to enhance land and housing supply in the medium and longer terms

Editorial | Despite an array of other problems, keep focus on affordable housing

With prices still beyond the reach of average buyers, the government must step up efforts to enhance land and housing supply in the medium and longer terms