Lam fights squeeze with starter flats

Top News | Phoenix Un 7 Sep 2017

Affordable small and plain housing will be subsidized under a new scheme to help young families who have been squeezed out of the skyrocketing property market to buy their first home, Chief Executive Carrie Lam Cheng Yuet-ngor said yesterday.

Speaking at the Sixth Asia-Pacific Housing Forum, Lam said she is introducing "a new form of subsidized- sale flats called Starter Homes for Hong Kong permanent residents aspiring to buy their first flat but whose income exceeds that applicable to the Home Ownership Scheme and who are finding private housing prohibitively expensive.

"This will reignite their dream to afford a home in Hong Kong."

The HOS income limit is HK$52,000 a month.

Lam is set to announce details of the Starter Homes in her first policy address on October 11, keeping a promise from her campaign manifesto.

Lam told reporters after the forum that owners of HOS flats or those who currently own flats will be ineligible.

"You can imagine that I want to help the relatively younger families who have finished their studies and have jobs, and they cannot buy flats in the private market despite the fact that their incomes are not low because house prices in the market are skyrocketing," Lam said.

"The lower the housing price, the more restrictions there will be."

The design and decoration of the flats will be simple, Lam said.

"It's not the function of the government to treat housing as goods which can be transacted in the market with asset appreciation," Lam said.

In her speech at the forum, Lam said she proposed in her election manifesto the Starter Homes plan "in light of the surge in property prices which are now at their historic high, recording an increase of 20 percent year-on-year."

She noted: "Thousands of young children in Hong Kong are now living in what we call subdivided flats and like me have to do their homework on their bed. Others are living in converted units in industrial buildings which carry fire risks.

"We, as a government and a generation, must not let our younger generation down."

About 20 people of the Concerning Grassroots' Housing Rights Alliance protested outside the JW Marriott Hotel calling for the government to increase public rental housing supply and reinstall rent control. They were stopped by security guards and clashes occurred, forcing guards to chain its glass entrance.

Lam received the protest letter from the demonstrators and urged them: "I agree that the housing problem should be resolved, thus please support the work of the task force."

The Lam-appointed Task Force on Land Supply had its first meeting yesterday afternoon.

Town Planning Board member Lawrence Poon Wing-cheung said flats in the new scheme should be sold below HK$4 million each.

In an RTHK program yesterday, Poon said the price should be set based on the construction cost instead of the market price.

"People would be worried if it is linked to market price because it might follow the market and skyrocket," he said.

Housing Society chairman Marco Wu Moon-hoi agreed that it would not be suitable for the price to be a fixed percentage of the private market.

Chairwoman of the Legislative Council Panel on Housing Alice Mak Mei-kuen said the government should set higher restrictions for Starter Homes.

"For example, the government should state that owners can only sell their flats 10 years after buying it, and they can only sell them to people eligible for the flats," Mak said.

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