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LCQ10: Interim Scheme to Extend the Home Ownership Scheme Secondary Market to White Form Buyers

     Following is a question by the Hon Tony Tse Wai-chuen and a written reply by the Secretary for Transport and Housing, Professor Anthony Cheung Bing-leung, in the Legislative Council today (December 10):


     In 2013, the Government introduced the "Interim Scheme to Extend the Home Ownership Scheme Secondary Market to White Form Buyers" (the Interim Scheme) with a quota of 5 000 for persons meeting the eligibility criteria for the Home Ownership Scheme (HOS) White Form applicants to purchase HOS flats on the HOS Secondary Market (second-hand HOS flats) without payment of land premium. The Government announced on the 24th of last month that a new round of the Interim Scheme will be implemented in the middle of next year with a quota of 2 500. In this connection, will the Government inform this Council:

(1) of the number of buyers who purchased second-hand HOS flats under the first round of the Interim Scheme as at the end of last month, with a breakdown by the age group to which they belonged, quota category, type of flats purchased and district where the flat was located, set out in the table below;

                               Total number of buyers

Age              30 or below
                 Above 60

Quota category   Singleton

Type of flat     One-bedroom
                 or larger

District         Hong Kong

(2) whether it has followed up and studied the housing situation of HOS flat owners after they sold their properties to Interim Scheme buyers; if it has, of the details; if not, the reasons for that, and whether it will follow it up in future;

(3) whether it has set a target number of second-hand HOS flats to be purchased under the second round of the Interim Scheme; if so, of the details and the criteria based on which such target was set; if not, the reasons for that; and

(4) as the authorities have indicated that they will conduct a review on the effectiveness of the Interim Scheme, of the earliest time for the review to commence as well as its scope, contents and timetable; whether they will make public the outcome of the review and what follow-up actions they will take; if they will not, the reasons for that?



     The Home Ownership Scheme (HOS) Secondary Market Scheme was introduced in 1997 to allow owners of subsidised sale flats to sell their flats, without payment of premium, to households with Green Form (GF) status (note 1).  To address the home ownership aspirations of White Form (WF) applicants (note 2) and to implement the Chief Executive's election manifesto, the Hong Kong Housing Authority (HA) introduced the Interim Scheme to Extend the Home Ownership Scheme Secondary Market to White Form Buyers (Interim Scheme) in January 2013 to allow 5 000 WF applicants to purchase flats without premium paid in the HOS Secondary Market. The Interim Scheme provided WF applicants with an additional channel previously not available to them to have the opportunity to purchase subsidised sale flats before newly built HOS flats are released onto the market. The Interim Scheme is temporary in nature. Its future, including whether it will be implemented on a recurrent basis, will be decided upon completion of a comprehensive review.

     My reply to the four parts of the question raised by the Hon Tony Tse Wai-chuen is as follows -

(1) As at end September 2014, 2 165 Letters of Nomination were issued by the HA and the Hong Kong Housing Society under the Interim Scheme, of which 2 161 applicants eventually completed transactions.  Among the applicants who have completed the transactions, 218 were one-person applicants while 1 943 were family buyers. We do not have information on the breakdown on buyers under the Interim Scheme by their ages, flat types and districts where the flats are located.

(2) According to the current arrangement, flat owners who sold their flats in the HOS Secondary Market are not required to inform the HA of the reasons for selling their flats or their housing arrangement after selling their flats. Therefore, the HA does not have the relevant information.  The HA currently has no plan to conduct such a research.

(3) and (4) As at end September 2014, about 2 200 applicants with WF status had achieved home ownership under the Interim Scheme. Without the Interim Scheme, these households might have difficulty purchasing flats in the private housing market.  Purchasing a flat is an important decision.  Prospective buyers should exercise caution and should assess their affordability in making such a decision. This applies to purchasing a flat in both the private housing market and the market of subsidised sale flats. Whether WF applicants issued with quotas under the Interim Scheme can successfully purchase flats in the HOS Secondary Market depend on many factors, including whether they can find suitable flats of their choice and whether they consider the prices reasonable.  The Interim Scheme aims at providing WF applicants with home ownership aspirations an additional channel to purchase subsidised sale flats. Its effectiveness should not be judged solely by the number of transactions completed.

     The HA's Subsidised Housing Committee (SHC) conducted an initial assessment on the implementation of the Interim Scheme on November 24, 2014, the outcome of which has been uploaded onto the HA's website. In summary, while the Interim Scheme is effective to a certain extent, with the experience of only one round of the Interim Scheme and with about half of the quotas utilised by eligible persons, the SHC considered that more information is required to review the full and exact impact of the Interim Scheme on property prices to enable it to decide whether or not to retain the Interim Scheme.  Given the strong demand for subsidised sale flats (especially from WF applicants) nowadays, the SHC considered it more prudent to release one more round of the Interim Scheme with 2 500 quota in the second half of 2015 to further test out the effect of the Interim Scheme.  This can respond to WF applicants' home ownership aspirations on the one hand, and by reducing the quota to 2 500, address the concern on possible impact of the Scheme on flat prices on the other.  A comprehensive review will be conducted thereafter to decide on the future of the Interim Scheme.  Upon completion of the comprehensive review, the Government will report the outcome of the review to the Legislative Council Panel on Housing.


1. Those eligible for GF status include Public Rental Housing (PRH) tenants and PRH applicants who have passed the detailed eligibility vetting and are due for flat allocation in about a year's time.

2. WF applicants refer to households who do not satisfy the requirement for GF status but meet the eligibility criteria of subsidised sale flats set by the HA.  Such eligibility criteria include residence rule, income and asset limits.

Ends/Wednesday, December 10, 2014
Issued at HKT 12:35


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