Monday, November 30, 2015   

Big hopes, little cash

Eddie Luk

Monday, February 04, 2013

Hopes of young home-seekers with little cash look set to be blown away by moves to set a minimum income for applicants.

The proposal of a top housing committee comes amid a growing debate on whether the administration should help fresh graduates own homes.

Marco Wu Moon-hoi, a member of the long-term housing strategy steering committee, says some fear that those with low incomes may not be able to meet their mortgage payments once interest rates begin to rise.

Some members also feel priority should be given to young couples with one child who cannot afford to buy a flat in the private housing market.

Wu said members brought up the minimum salary issue after it was found that 2,000 of the 58,000 applicants for units in the subsidized Greenview Villa project in Tsing Yi had low or even no income.

They included young people who claim to have financial support from their families and fresh graduates in low-paying jobs.

Committee member Raymond So Wai-man, dean of the Hang Seng Management College's school of business, said the government should set a minimum income threshold. "I think the government should give priority to those families with children who cannot afford to buy in the private market instead of the young people and fresh university graduates with relatively low or no income," So said.

"The provision of subsidized housing involves taxpayers' money and the government has to prioritize which groups in society are in desperate need of subsidized h
ousing. "Young people or fresh graduates can apply later when their income levels rise and meet the minimum income requirement."

Another member, Wong Kwun, said the government has to assess whether applicants are able to pay their mortgages should interest rates rise in the future.

Applicants for Home Ownership Scheme or Greenview Villa units have their income capped at HK$40,000 a month but there is no minimum.

Wu - who is also chairman of the Housing Society that built Greenview Villa - said the society may be given another piece of land in Sha Tin this year for another project.

Wu agreed with a warning given by the former financial secretary Antony Leung Kam-chung who said if there's a glut of new property and a rise of interest rates, Hong Kong could face another property crash.

The society chairman noted that buying a flat is a long-term investment, with buyers having to go through three or four property market cycles during the length of their mortgages.

However, to meet demand for more affordable property, the society will develop more projects if and when asked by the government.

Secretary for Development Paul Chan Mo-po said the government is keeping an open mind on suggestions that civil servants' cooperative buildings be redeveloped.

Secretary for Transport and Housing Anthony Cheung Bing-leung has said vacant civil service premises built under a special 1950s scheme could be redeveloped.

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