Opinion

Housing crisis: Hongkongers need their piece of land to find peace of mind

Unaffordable housing is leading to public frustration and resentment, especially among young people, potentially undermining social and political stability

Hong Kong must act to improve affordability and promote home ownership among those unable to get on the property ladder

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Xiaogang Wu is Yufeng Global Professor of Social Science and director of the Center for Applied Social and Economic Research (CASER) at NYU Shanghai, and professor of sociology at New York University (xw29@nyu.

Published: 6:45am, 12 May 2022

Hong Kong is ranked among the world’s most expensive cities in terms of property prices. Owning a home in the city has never been as challenging and important. There are serious concerns that unaffordable housing is leading to public frustration and resentment, especially among young people, undermining social and political stability.

Governments worldwide have implemented initiatives to address affordability, subsidising both property rents and purchase costs. Hong Kong introduced the Home Ownership Scheme (HOS) in 1978 to bridge the affordability gap.

Under the scheme, eligible households could buy flats from the government at 30 to 50 per cent below market price and borrow 90 to 95 per cent of the purchase price. The higher-income public housing tenants could attain home ownership and leave public rental flats for those in greater need.

The HOS later extended its coverage from multi-member households to single-individual households, offering greater discounts, improved flat design and fewer restrictions on resale. These measures, along with rising property values, have attracted an increasing number of applicants and helped them to own a home.