24 October 2017 - Chief Executive Carrie Lam delivered her maiden policy address on 11 October 2017. During her 40-minute speech, the city’s new leader highlighted a number of livelihood issues, with housing policies raised to the spotlight. Here is a summary of key housing initiatives put forward by Lam in the recent policy address.
1. A “Starter Homes” Scheme will be launched to help the middle-class purchase their first flats.
While the details of the pilot scheme will not be finalized until mid-2018, “Starter Homes” are intended to be affordable government-subsidized housing targeting middle-income families. The monthly income ceiling for the “Starter Homes” Scheme is projected to be HKD 34,000 for single applicants and HKD 68,000 for households. A public-private partnership model will be adopted for the construction of these units. Private developers will be required to build a certain number of “Starter Homes” in order to acquire land in future government land sales. The development site at Anderson Road in Kwun Tong is envisioned to be the first “Starter Homes” residences project, offering 1,000 housing units by the end of 2018.
2. The supply of Green Form Subsidized Homes will be increased to assist Public Rental Housing (PRH) tenants in moving up the housing ladder.
Lam proposed to offer more units under the Green Form Subsidized Home Ownership Scheme (GHS) to assist PRH tenants with home ownership. PRH flats occupied by vacating tenants will be freed up for the long waiting list. Carrie Lam’s government is more inclined to increase the supply of GHS units rather than PRH flats to tackle the public housing shortage. A preliminary assessment estimates some 4,000 flats will be up for sale under the GSH Scheme in late 2018.
3. HOS supply will be increased and the Interim Scheme will be standardized.
Existing housing policy defines that only Green Form Buyers are eligible for the resale of HOS units with premiums unpaid. In 2013 and 2015, the Hong Kong Housing Authority (HKHA) launched two pilot rounds of the Interim Scheme of Extending the HOS Secondary Market to White Form Buyers, yielding a total of 380,000 flats available for purchase on the secondary market by White Form buyers. Lam proposed that the Interim Scheme should be standardized in order to help private housing tenants fulfill their aspirations for home ownership and to foster the turnover of HOS flats.
4. The Task Force on Land Supply will conduct public consultation on different land supply options and strive to reach the broadest possible community consensus.
Established in September this year, the Task Force will be dedicated to examining the merits and drawbacks of various proposals for increasing land supply. It is expected to facilitate a community-wide discussion on how the city should expand its land for residential development and to create a framework for long-term land supply strategies.
5. Short-term community initiatives will be put into place to increase the supply of transitional housing.
Lam proposed several specific measures to offer alternative transitional rental housing options for families with inadequate housing:
(i) Convert idle government premises to PRH units for social housing projects like the “Light Housing” project in Sham Tseng;
(ii) Allow owners of subsidized home (under Home Ownership Scheme) to rent out their apartments with premiums unpaid at below market rate on a pilot basis;
(iii) Explore the conversion of industrial buildings into transitional housing;
(iv) Support NGO that construct pre-fabricated modular housing on idle sites;
(v) Support Community Housing Movement initiated by the Hong Kong Council of Social Service.
Ever since Carrie Lam pledged to prioritize housing issues in her election manifesto, the public has been waiting to see the strength and tenacity of the city’s first female leader. Now that Lam’s first policy address has been released, the Chief Executive seems to have surprised the public with her supply-side management approach to housing challenges. Specific measures such as the “Starter Homes” project, increasing the supply of GHS and HOS units, and the standardization of the Interim Scheme signal the new office’s determination to provide more affordable housing for the people of Hong Kong. While these proposals are still in the initial planning stages, Hong Kong residents will be reassured to see bold government efforts to tackle unsustainable housing prices and subsidized home ownership as the Chief Executive promised during her election campaign.
