Legislative Council meeting Motion – Increasing housing supply to rectify housing shortage problem

Increasing housing supply to rectify housing shortage problem

MR CHAN CHUN-YING (in Cantonese):

President, property prices in Hong Kong have remained high and the supply of housing cannot meet the demand. This has become the direst and most pressing problem in people’s livelihood. According to the Government’s survey, the prices of private residential properties last year were more than double of those in the peak in 1997. In the third quarter of last year, the public’s home purchase affordability ratio, that is, the ratio of mortgage payment to the median income of households, deteriorated to 74%, much higher than the long-term average of 44% over 1998-2017. The average waiting time for over 150 000 public housing applications is 5.5 years. Not only has this led to serious deterioration in the quality of life of the public, even the economic growth and social stability of Hong Kong have been adversely affected.

The root cause of the housing problem is land shortage. In view of this, the SAR Government has been implementing a streamlined land supply strategy in recent years by proposing such measures as carrying out reclamation outside the Victoria Harbour, developing caverns, making optimal use of brownfield sites, and so on. However, the intricate network of interests and complicated and prolonged land resumption and compensation processes have made the task of land development very slow and difficult.

The motion proposed by Mr James TO today seeks to increase the supply of public housing through short-term and medium-term measures. I believe no one would object to such an aim. However, among the seven measures put forward in the motion, apart from the measure in point (5) related to the “Letting Scheme for Subsidised Sale Developments with Premium Unpaid”, the others are all conceptual topics that have been raised repeatedly in recent years but they are not operable in the short or medium terms. Some of these measures will even encounter such challenges as compensation claims, lawsuits, environmental assessments, and so on, and some of the measures have been studied by the SAR Government for years without the slightest progress being made. It can thus be seen that there is no fast-track in solving the problem of land shortage in Hong Kong.

President, the Government has made it clear that when planning for new housing supply in the future, the ratio of public housing to private housing will be 7:3. If we can follow the measure of segregating public housing and private housing into two markets adopted by the Singaporean Government, we can expect to see more distinct housing ladders for the Hong Kong public in the future. In fact, however, the land reserve in Hong Kong, including the land for some of the countermeasures mentioned in the motion today, is overwhelmingly concentrated in the New Territories. In the British-Hong Kong era, the Government believed that it was no easy task to discuss with the indigenous residents about the ownership of a large amount of land, so it could only carry out reclamation continually to create new towns to dovetail with Hong Kong’s development. At the same time, it introduced the New Territories small house policy to appease the affected indigenous residents of the New Territories.

However, up to now, no fundamental change in the situation can be seen and it can even be said that the situation has become more complicated. Apart from the intricate web of interests involved in the use of land by many indigenous residents, various types of people hoarding land and non-indigenous villagers not wishing to see any large-scale development are also involved. It is therefore felt that finding land is often a time-consuming business getting nowhere that should best be avoided. Since the asking prices of land are high and the costs of development are also quite high, property prices are driven up continually.

The Policy Address last year proposed a multi-pronged approach comprising measures such as the Lantau Tomorrow Vision, the development of brownfield sites in the New Territories, the Land Sharing Pilot Scheme, the revitalisation of industrial buildings, streamlining control, and so on. However, the only fundamental way out is to reclaim large areas of land from the sea to bring about a breakthrough in supply and build a modern urban area. Reclaiming land from the sea will make it possible to take the greatest degree of initiative and agression and strive to solve the housing problem of Hong Kong people in about 10 to15 years’ time.

Over the years, Hong Kong has gained experience from reclaiming a total of 7 000 hectares of land from the sea, so the reclamation techniques and safety are beyond doubt. Let me reiterate one point: In creating an artificial island by reclamation, only one environmental assessment, one transport planning and one lawsuit are necessary, so it is double output with half input. However, if the hundreds of residential buildings on the artificial island are built on agricultural lands in the New Territories, brownfield sites and golf course, with 10 blocks built here and eight blocks elsewhere, it will be necessary to deal with dozens and even over 100 environment assessment reports, lawsuits and transport planning. These will be long-drawn-out exercises that will slow down the pace of housing construction, with double input for half output.

Although it is said that extensive reclamation is the most thorough way to resolve land shortage in Hong Kong, if the SAR Government wants to take forward this blueprint in the future, it has to lobby for greater support. For example, although the ecological sensitivity of the central waters is lower, it is still necessary to carry out stringent environment assessments in earnest and adopt new technical measures to reduce the impact to a minimum. Meanwhile, the details of the proposal and planning design should be worked out and the long-term housing strategy should be refined so that housing supply, in particular the supply of public housing, can materialize and reach its intended users for the public and younger generation to see hope. In addition, it is also necessary to work out the details of the relevant financial arrangements by setting the total amount of investment in the project and the amounts to be borne each year clearly, so as to give the public and the Legislative Council a proper account.

President, it is believed that it will take time to turn the countermeasures proposed in the motion today from concepts into operable proposals, so they cannot solve the problem of land and housing supply in the short term. Instead, Hong Kong should put the long-term feasible solutions into action immediately and implement them as soon as possible so that the proposal can turn from a long-term one into a medium-term or short-term one after a few years. Otherwise, on the problem of an inadequate supply of housing, the situation of having discussions without making decisions will recur all the time, thus seriously affecting Hong Kong’s long-term development and the public’s quality of life.

President, I so submit.