Property

The effect of loosened Green Form subsidised home policies

Divided house in Hong Kong

A large number of low-income individuals in Hong Kong are incapable of buying property. The lucky ones among them get to live in affordable public housing, while many others don't receive the Comprehensive Social Security Assistance don't live in public housing, and don't have enough income to be taxed. Unable to rent normal residential units, they resort to subdivided flats, where entire families are crammed into small spaces.

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Today’s subdivided flats can be roughly categorised into independent and communal types. An independent subdivided flat comes with an en-suite bathroom and kitchen, allowing residents to cook at home and giving them more privacy. The rent of this type of flat usually starts at HK$4,000, some of the better decorated and equipped ones can go for HK$7,000 a month. 
On the other hand, residents of communal subdivided flats have to share a bathroom and kitchen (some of those flats don't even have a kitchen). The sharing situation can easily lead to conflicts amongst residents, especially during meal times. 
Therefore, many of them would rather dine out for all their meals and only go home to sleep. The rent for communal flats is usually between HK$2,500 to HK$3,000 a month.

Given the high housing prices and the rising rent, it is unlikely that the Government will ban subdivided flats at the moment. However, the extremely small and crowded space of subdivided flats becomes breeding grounds for fire hazards and resident conflicts.

The newly appointed Secretary of Transport and Housing, Frank Chan, recently paid visits to a few subdivided flats in Hong Kong and witnessed first-hand the living circumstances of the residents. He expressed concern and the possibility of government subsidies for social enterprises to rent walk-up buildings and lease the units out to people in urgent need of accommodation, to provide those individuals with a safe and decent living environment while they wait for their chance of public housing.

The truth is, there are empty factories and warehouses across Hong Kong, that through simple modifications and installment of Government-approved fire exits and hygiene facilities, can be subdivided into transition flats that would offer residents better living conditions.

It seems that on the issue of expanding the supply of rentable units, we have forgotten about the power of subsidised public housing. Between Green Form homes and public housing estates sold under the Tenants Purchase Scheme, there are at least 300,000-400,000 units available, many of which have been sitting idle for some time. However, owners of these properties must first pay a premium to the Hong Kong Housing Authority before they can let their flats, which is hard for the rent to make up for. I suggest for the Government to explore the possibility of waiving premium payment for certain property owners, 
as well as setting rent standards and special rental income taxes.

I believe that if Green Form subsidised homes are made more flexible and accessible, the existing real estate resources will be better utilised and more units will become available to meet the urgent market demand. 

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