Hong Kong studies expanding home ownership for public housing tenants
Hong Kong's deputy financial secretary said the government is studying whether to sell more rental flats under the Home Ownership Scheme, noting concerns about management issues and pricing. The city will continue existing measures to help young people and better-off tenants buy homes.
Hong Kong's deputy financial secretary and acting housing secretary told the Legislative Council on 12 November that the government is carefully studying whether to sell more public rental flats under the Home Ownership Scheme. He was responding to a motion on optimising public housing policy to promote upward mobility.
The official noted that Chief Executive John Lee had in September outlined four concerns about expanding the scheme: about 15 per cent of flats in existing projects remain unsold, mixed ownership and tenancy in the same block creates management problems, pricing remains controversial because current prices exclude land costs, and buyers do not need to pass a means test. The government launched a large-scale study in October to address these issues.
On policies for better-off public housing tenants, the government is taking a two-pronged approach: tightening rules while helping tenants buy homes. For example, the quota for green and white form applicants under the Home Ownership Scheme was adjusted from 40:60 to 50:50 this year. Tenants who voluntarily move out can keep their green form eligibility for four years to buy subsidised flats. The government has no plan to introduce a compulsory savings scheme for tenants, saying it would not be a good use of public funds and would be unfair.
On youth housing, the official said 40-year-olds and under already buy half of all Home Ownership Scheme flats. Since July, the government has given white-form young families and single applicants an extra ballot number. It also introduced a youth quota under the White Form Secondary Scheme and expanded it this year. For families with newborns, the maximum mortgage loan-to-value ratio will rise from 90 per cent to 95 per cent from the next sales phase.
The official said 85 per cent of buyers under the First Home Scheme are aged 40 or below, showing young people are the main beneficiaries. The government has also taken steps to activate the secondary market for subsidised flats, including extending mortgage guarantee periods and repayment periods, shortening the resale restriction period, and introducing rental and exchange schemes for elderly owners.