​Following is a question by the Hon Andrew Lam and a written reply by the Secretary for Development, Ms Bernadette Linn, in the Legislative Council today (October 7):
 
Question:

     There are views suggesting that urban-rural integration is one of the core concepts underpinning the Government's promotion of the development of the Northern Metropolis (NM), and that the original village houses play an important role in the NM during its transitional development phase. Introduced in 1972, the New Territories Small House Policy allows a male indigenous villager aged 18 years old or above who is descended through a male line from a resident of a recognised village in the New Territories of Hong Kong, to apply for permission to erect, for once in his lifetime, a small house for himself on a suitable site within his own village. In this connection, will the Government inform this Council:

(1) of the number of residential properties built to date on old house sites (i.e. land in the New Territories registered for house site use under the 1905 Block Government Lease), and the number of sites on which no construction has taken place;

(2) of the respective numbers to date of small houses that have had their land premium paid up and those that can be freely transferred on the market without paying a land premium;

(3) of the number of whole blocks of small houses with sub-deeds to date, and the number of sub-divided units involved; and

(4) in order to promote urban-rural integration, whether the Government will conduct a comprehensive review of the development policy and regulatory framework for village houses in the New Territories; if so, of the details; if not, the reasons for that?

Reply:

President,

     The New Territories Small House Policy has been implemented since 1972, to allow a male indigenous villager aged 18 years old or above who is descended through the male line from a resident in 1898 of a recognised village in the New Territories to apply for permission to erect, for once in his lifetime, a small house for his occupation on a suitable site within his own village.

     In response to the respective parts of the question raised by the Hon Andrew Lam, our reply is as follows:

(1) Block Government Leases (BGLs, formerly known as Block Crown Leases) are land lease documents issued by the British Hong Kong Government following a comprehensive land survey of private land in the New Territories conducted via commissioned surveying staff in the early years (around 1900s), covering over 200 000 parent lots. The lot particulars registered in the schedules of the BGLs are generally classified as agricultural lots or building lots, commonly known as old schedule agricultural lots or old schedule building lots. The land uses of these lots are mainly simple and snapshot descriptions based on the land uses observed during the field surveys at that time. The Lands Department (LandsD) does not maintain statistics on whether any residential properties are erected on old schedule building lots.

(2) Land grants granted to indigenous villagers or Building Licences issued by the LandsD in respect of agricultural land they owned under the Small House Policy usually contain restrictions on the sale or other disposal of the small house (commonly known as "Ding" House). An owner is required to pay an additional premium to the Government before the restrictions can be removed. 

     Specifically, for a small house granted on an indigenous villager's agricultural land by way of a Building Licence, the villager is required to pay a premium to the LandsD for the removal of the alienation restriction if he transfers ownership of his small house within the five-year alienation restriction period after the issue of the Certificate of Compliance (CoC). For a small house granted on Government Land by way of Private Treaty Grant, the villager is required to pay an additional premium for the removal of the alienation restriction whenever he transfers ownership of his small house. 

     Since the introduction of the Small House Policy to end-June 2026, the LandsD has approved 41 453 applications for CoCs for small houses (Note). During the same period, the LandsD has approved a total of 15 612 applications for the removal of the alienation restriction. Furthermore, as mentioned above, for a small house granted on agricultural land by way of Building Licence, the indigenous villager may transact the small house freely after the five-year alienation restriction period from the date of CoC without the need to submit an application to the LandsD. Currently, the LandsD does not maintain any statistics related to small houses which can be freely transacted in the market.

(3) Applicants for small houses can freely transact their small houses upon the LandsD's approval to remove the alienation restriction and payment of the required premium. If owners concerned decide to partition the property for sale, they can register a supplementary deed at the Land Registry (known as Deed of Mutual Covenant) without the need to submit an application to the LandsD. Neither the LandsD nor the Land Registry maintain the relevant statistics.

(4) The Court of Final Appeal (CFA) ruled on the judicial review of the Small House Policy in 2021, confirming that all components under the Small House Policy, namely Free Building Licence, Private Treaty Grant and Land Exchange, are lawful traditional rights and interests of the indigenous inhabitants of the New Territories within the meaning of Article 40 of the Basic Law. In view of the historical background of the Small House Policy, having been in operation for many years, and that the CFA has upheld its lawfulness and compatibility with the Basic Law, we currently have no plans to review the relevant policy.

     On the other hand, urban-rural integration is one of the key focuses in the development of the Northern Metropolis (NM). While taking forward the development of new development areas in the NM, we will make good use of villages' cultural resources in the areas and practise the concept of urban-rural integration proactively. Relevant measures include revitalising signature rural buildings and establishing heritage trails in villages; reserving space for open spaces and organising traditional festive events; improving sewerage and other rural infrastructures; allowing conversion of the whole block of the New Territories Exempted Houses in pilot areas into restaurants, retail shops, or guesthouses; leveraging farmland for farming activities; and establishing an NM Urban-rural Integration Fund as a pilot scheme. The Small House Policy does not impede the implementation of these measures.

     The Government has announced the launch of the $200 million NM Urban-rural Integration Fund. Applications will be invited and the first batch of projects will be approved next year, capitalising on community wisdom to promote rural tourism. We will also publish the Guidelines on Promoting Urban-rural Integration in the NM within this year. The first signature project to be launched next year, the "San Tin Timewalk", will link attractions with features of traditional rural architecture as well as historical and cultural heritage, creating distinctive landmarks and tourist attractions in collaboration with villagers.

Note: After an application to build a small house is approved by the LandsD, the applicant has to pay an administrative fee and/or a premium. The applicant may then, in accordance with the Buildings Ordinance (Application to the New Territories) Ordinance (Cap. 121), apply to the LandsD for and obtain the Certificates of Exemption in respect of building works, site formation works and drainage works before the commencement of construction works.  

     After the construction works are completed, the applicant has to submit a construction completion report to the LandsD. The LandsD will issue a CoC if, having conducted on-site checking, it is satisfied that the applicant has complied with all relevant grant conditions, requirements and obligations as specified in the small house grant.

Ends/Wednesday, October 7, 2026
Issued at HKT 15:30

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