The Government's key housing goals are -
| (a) | to help all households gain access to adequate and affordable housing; and |
| (b) | to encourage home ownership in the community. |
2. The overall strategy by which we seek to achieve these goals is -
| (a) | to provide a steady and sufficient supply of land, together with supporting infrastructure, for public and private housing; | |
| (b) | to create the conditions to enable the private sector to make the fullest possible contribution towards meeting the demand for housing; | |
| (c) | to implement subsidised housing schemes to enable those in the relevant income groups to buy their own homes; | |
| (d) | to provide quality public rental housing at reasonable rents for those who cannot afford any other type of housing; and | |
| (e) | to monitor the private housing market and, where necessary, introduce measures to curb speculation. |
3. We believe that this continues to be the right policy for Hong Kong. However, we also believe that we should review from time to time our success in achieving our goals so that we may be able to respond more effectively to the changing needs and aspirations of the community. We have now completed a review of the policies and programmes which underpin the Government's housing strategy. We have concluded that there are four areas where we need to focus our attention in particular if we are to be better able to achieve our goals in future. The challenges we face are -
| (a) | to increase the supply of flats to meet forecast demand for housing, in particular by providing a steady and sufficient supply of serviced land; | |
| (b) | to maximise the contribution of the private sector towards meeting the demand for public and private housing; | |
| (c) | to encourage wider home ownership, especially among public housing tenants; and | |
| (d) | to ensure that public rental housing is provided to those in genuine need. |
4. A list of our specific recommendations is annexed to this Executive Summary. The main proposals are highlighted below.
5. The first step in providing an adequate supply of flats in both the public and private sectors is to assess the demand for housing. This involves the running and re-running of a computerised housing demand model, which will respond to changes in population, housing policy, economic conditions and other relevant factors.
6. The model operated by the Government's Working Group on Housing Demand currently indicates a requirement for about 80 000 new flats on average a year over the 11-year period from April 1995 to March 2006 : some 85 000 flats in the first part of the period (April 1995 to March 2001), and 73 000 flats in the second part (April 2001 to March 2006). We have already allocated or identified sufficient land to meet the forecast requirement for the first part of this period. For the second part, we have assumed, as reflected in the Territorial Development Strategy Review, a requirement for 78 000 flats a year (which provides a safety margin of about 7% on the forecast requirement for the period). To meet this requirement, we will need to pursue the early development of new strategic growth areas, and, where feasible, the rezoning of existing land. We will also need to increase, where possible, development density to make better use of existing housing sites.
7. In addition to new development, we will need to monitor carefully the extent and speed of redevelopment in the public and private sectors. We will also need to monitor, and, where necessary, take measures to deal with supply constraints other than land, in particular the capacity of the construction industry.
8. Higher private sector investment in housing reduces the gap between supply and demand, and lowers the pressure on domestic property prices. We wish to encourage such investment by easing any supply constraints especially of land and labour, by streamlining and speeding up Government procedures for the approval of private housing projects and by applying these procedures flexibly and pragmatically.
9. We also wish to maximise the potential contribution of the private sector towards delivering our public housing programmes. In addition to the existing Private Sector Participation Scheme, we propose that new forms of "mixed development" should be used to produce an increasing proportion of subsidised home ownership flats. A feasibility study and pilot scheme will be necessary to determine in detail how this new joint venture concept will operate.
10. While seeking to make the fullest possible use of the resources and abilities of the private sector in fulfilling our housing policy objectives, we will also continue to monitor the operation of the private housing market and to take steps, where appropriate, to ensure adequate consumer protection.
11. The Government's goal is to encourage home ownership in the community. Home ownership helps to foster social stability and a sense of belonging, and to provide personal financial security.
12. Since home ownership in the private sector remains beyond the reach of many families, the Government has implemented a series of carefully targeted subsidised home ownership schemes for middle and lower income families. As a result, the home ownership rate has increased by one third over the past ten years to just over 50% today. We believe that the Government's housing delivery agents - the Housing Authority (HA) and the Housing Society - should continue to operate and, where possible, expand these successful schemes. We will shortly seek the approval of the Legislative Council for a further injection of funds into the Sandwich Class Housing loan scheme to help more families to buy their own homes.
13. At the same time, we believe that we should do more to help and encourage public housing tenants in particular to become home owners. By doing so, we not only improve the living standards of those concerned, we also increase the supply of public rental flats for re-allocation to families in greater need. In this way, we help to meet both the demand for home ownership, and the demand for public rental housing. Accordingly, we propose to allow public housing tenants to apply for the purchase of Sandwich Class Housing flats on equal terms with families living in private housing; to invite the HA to consider widening its existing scheme to transfer new rental blocks to the Home Ownership Scheme for sale to existing and qualified prospective public housing tenants, with the additional benefit of a monthly mortgage subsidy for tenants affected by the Comprehensive Redevelopment Programme who choose to buy new rental flats in reception estates; and to invite the HA to work out the details for a new scheme to sell suitable existing rental flats to public housing tenants at affordable prices.
14. We support the establishment of the Mortgage Corporation which will help banks and other lending institutions to provide an adequate supply of mortgage loans to help families wishing to buy their own homes.
15. The Government is firmly committed to providing adequate housing for those in genuine need. (Adequate housing does not have to be brand new flats.)
16. High on the public housing agenda is the need to improve the living conditions of those who are inadequately housed. To speed up the process, we propose to invite the HA to work out details to apply the same eligibility criteria to all prospective tenants, to minimise pre-emption by committed categories, and to restrict the grant of new tenancies, upon the death of the principal tenant, to those adult members of the deceased tenant's family who have a genuine need. We also propose that the HA should consider increasing rents gradually to more realistic but still affordable levels, while at the same time ensuring that its existing Rent Assistance Scheme continues to provide adequate assistance to families facing genuine hardship.
17. We will continue to encourage families who are inadequately housed to come forward and register on the Waiting List. We also highlight guiding principles for interim housing and clearance policy, and new initiatives to provide housing for the elderly.