USA News

Hong Kong’s Lee faces a stern test of more than $3.4 billion to ease the housing shortage

A $3.4 billion Hong Kong flagship plan to build temporary housing to ease a massive shortage is facing fierce criticism for its high costs and the absence of a long-term solution in one of the world’s most unaffordable property markets.

The global financial hub has long struggled with skyrocketing house prices, which have soared 350% in the past two decades and created one of the biggest wealth gaps in the world, making housing a serious social problem that Beijing is keen to see. the city’s leaders tackle.

Hong Kong Chief Executive John Lee, who announced his first major housing initiative in his policy speech last year, pledged to build 30,000 units of “Light Public Housing” over five years, with the hope of reducing the waiting time for public housing to 4-1/2 years from six years.

But critics have slammed the HKD 26.4 billion ($3.36 billion) price tag, noting that each unit costs roughly the same as permanent public housing, and say the scheme is just a band-aid to a lingering problem that could potentially breed discontent.

The backlash over the project is a major challenge for Lee after Beijing identified unaffordable housing as a key factor behind discontent, particularly among the city’s youth, that led to sometimes violent anti-government protests in 2019.

To further raise the stakes for Lee, Chinese President Xi Jinping last year called for a “better life, a bigger apartment” for the city’s people, many of whom live in cramped shared apartments and “cage” houses – wire mesh huts stacked on top of each other near glittering office skyscrapers.

“Wherever the site is, there would be voices of opposition,” said Simon Yau, a professor of urban studies at Lingnan University of Hong Kong, noting the criticism over the proposed locations of the houses, some of which are in far-flung urban areas.

“But with this price tag, the government is using taxpayers’ money to experiment,” Yau said.

Authorities last month announced eight sites for the homes, which would have unit sizes of 140 to 330 square feet (13 to 31 square meters) to accommodate families of one to five people.

The temporary houses, prefabricated units built using modular construction methods, would be dismantled after about five years, when the time for occupying the plots expires.

Yau said the scheme would do little to solve the housing shortage – a problem that has dragged on for more than two decades – as there are currently 200,000 people living in sub-divided apartments and the homes are not permanent.

A 2020 government report found that 1.65 million people, or 23.6% of the total population of 7.5 million, lived in poverty. That compares with the city’s roughly 434,000 millionaires in 2021, according to a Citibank survey.

Hong Kong is notorious for its number of split-level apartments, estimated at 110,000 units with a median floor area of ​​124 square feet, less than a parking space. Although their condition is extremely poor, their floor rent is 70% higher than the total floor rent in the city.

The government said the light public housing units would help tenants of sub-divided flats, as the rent would be HK$780 to HK$2,650 per month, significantly below the current median of HK$5,000 rent for sub-divided flats.

“Many people said that Hong Kong is an international city, but its living environment is not ideal,” Eric Chan, the city’s No. 2 official, told reporters this week.

“That’s why the government is taking this step.”

On Wednesday, the government plan faced a grilling from lawmakers, who did, however, approve a HK$14.9 billion budget request to build the first round of homes.

Lawmakers said the project at Kai Tak in Kowloon, the most controversial of the eight sites, would further strain already strained facilities and transport networks in the area.

“With 30,000 people added to the area, the community facilities are really inadequate,” said Starry Lee, chairman of the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB).

Some residents of Kai Tak said they would consider organizing protests, which would cause a significant headache for the government, and seeking legal redress. They said the scheme conflicted with plans to build a second central business district (CBD) in the area and could affect house prices.

“This is a matter of trust in the government (planning),” said Cheung King-fan, district councilor of Kai Tak area.

“Is the government trying to achieve the task (of increasing the public good) at any cost of public money?”

($1 = 7.8490 Hong Kong dollars)

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
%d bloggers like this: