Hong Kong housing

Record number of applicants scramble for affordable Hong Kong flats in Home Ownership Scheme sale

Subsidised housing sale a big draw for aspiring homeowners as 258,000 applicants try their luck in lottery for affordable flats

PUBLISHED : Tuesday, 16 October, 2018, 9:55pm
UPDATED : Wednesday, 17 October, 2018, 1:45am

A sale of subsidised homes in Hong Kong has drawn a record number of 258,000 applications, making it one of the most competitive offerings ever of affordable housing in the city.

Applications for the 4,431 flats, sold at around half the market rate, closed on Tuesday. The properties, at three housing estates in Cheung Sha Wan, Kai Tak and Tung Chung, will be sold for HK$4,976 to HK$7,246 (US$638 to US$925) per square foot, or between HK$1.18 million and HK$4.7 million (US$151,000 to US$600,000).

The Housing Authority said it received 106,000 applications during its second round of applications for the annual batch of subsidised flats to be sold under the Home Ownership Scheme.

With 152,000 submitted in the first round in April, a total of 258,000 applications were made, meaning there would be around 57 applicants competing for each flat. The figures are the highest since sales of subsidised housing resumed in 2014, when some 135,000 applications were tallied.

“I expected there would be lots of applications with the bigger discount and I knew my chances were slim, but I wanted to try my luck anyway,” said Sam Leung Shing-yip, 30, an aspiring homeowner.

I knew my chances were slim, but I wanted to try my luck anyway
Sam Leung, housing applicant

The batch of flats previously opened for applications in March and April, at 30 per cent below market prices.

But the red-hot property market in recent years, which has resulted in Hong Kong becoming the world’s least affordable city to own a home, propelled lawmakers and advocacy groups to pressure the government to revamp its pricing mechanism.

Chief Executive Carrie Lam Cheng Yuet-ngor announced a new pricing system for subsidised flats in June based on a family’s budget and affordability, which further slashed prices to about 48 per cent of market price.

While application numbers reached a record high, the sale still fell short of being the most competitive to date.

New subsidised flats will be sold for HK$1.18 million – but there’s a catch

That accolade goes to last year’s sale, in which some 88,000 families applied for 620 subsidised homes developed by the Hong Kong Housing Society, a non-profit organisation and Hong Kong’s second-largest public housing provider. That meant 141 applicants were scrambling for each flat.

Another prospective homeowner, Gloria Chau Lei-man, said that “it wouldn’t be a big deal” if her family missed out in this housing lottery.

“Although there are five of us living in a public housing flat, I know we’re still luckier than a lot of other people,” Chau said.

Around 15 per cent of Hong Kong’s 7.3 million residents live in subsidised flats, of which there are about 400,000.