Policy changes necessary to help developers avert future housing shortage
Certain policy changes would allow private developers a bigger role in addressing the shortfall in the city's housing supply
Over the past year the Hong Kong government announced a series of measures to alleviate the housing supply shortage while simultaneously responding to vehement opposition from various parties and fending off public accusations of collusion with the city's developers.
Behind all the arguments and controversies, the main questions remain: where are we in meeting our housing target? If we are lagging far behind our goal, what should we do to catch up?
To answer these we must first look at the available sources and measures of land supply.
There are six sources at present. The lion's share comes from the Land Sale Programme, through which 4,900 units were launched in the first and second quarter of the 2013-2014 financial year. Assuming the pace of new projects remains the same, some 10,000 residential units should come on line this financial year.
By comparison, only 2,600 units are expected to be launched by West Rail projects in 2013-2014, 1,800 units by the Urban Renewal Authority (URA) projects; and 3,100 units by Mass Transit Railway Corporation (MTR) projects, which are the second largest source.
The MTR projects have been in the spotlight as projects at Tai Wai and Tin Shui Wai stations have stalled when high land premiums deterred developers from bidding. Soaring property prices and the resulting high land premiums also make private development or redevelopment projects less appealing, and have slowing the pace of project launches in recent years.
