Hong Kong 2006 - Housing

The Government ensures that all those who cannot afford adequate accommodation in the private market have access to subsidised public rental housing. It is committed to maintaining an average waiting time for public rental housing at around three years and ensuring that there is adequate supply through a rolling construction programme run by the HKHA. The actual number of units to be built is adjusted regularly to take into account factors including the housing demand of low-income families and the turnover in tenancies.

At present, about 2 097 800 people, or 30 per cent of Hong Kong's population, live in public rental housing estates of the HKHA and the Hong Kong Housing Society (HKHS)³. The revised estimate of the HKHA's expenditure on housing in 2006-07 was 14.5 billion, accounting for approximately 5.9 per cent of public expenditure. At year-end, there were 106 600 households on the waiting list for the HKHA's public rental housing and the average waiting time was about 1.9 years.

It is the long-established policy of the HKHA to set public rental housing rents at affordable levels. At present, rents are inclusive of rates, management and maintenance costs, and range between $250 and $3 810 per month.

Following a comprehensive review and extensive public consultation, the HKHA endorsed in November 2006 a new mechanism for determining how the rents of public rental housing are to be adjusted. In essence, an income-based rent adjustment mechanism which provides for both upward and downward adjustments in domestic rents according to changes in tenants' household income will be adopted. Suitable amendments to the Housing Ordinance will be introduced into the Legislative Council to effect the new mechanism.

The Rent Assistance Scheme was introduced by the HKHA in 1992 to provide assistance to its public housing tenants facing temporary financial hardship. Eligible tenants are offered a 50 per cent rent cut. To assist more needy families, the HKHA revised the scheme in October 2002 and the eligibility criteria for elderly tenants were relaxed. Tenants affected by redevelopment are also eligible for rent assistance immediately upon being rehoused.

In March 2006, the HKHA further relaxed the eligibility criteria for non-elderly public housing tenants so that they may have benefits similar to those enjoyed by their elderly counterparts. These eligible households are entitled to 25 per cent rent reduction. At the same time, the rent-to-income ratio threshold was lowered and the three-year residence criterion for households in older blocks was also lifted. As at the end of 2006, some 38 000 households had benefited from the scheme.

Better-off tenants are required to pay higher rents. At the end of December 2006, there were 20 100 households paying higher rents. The subsidy saved under this scheme amounted to about $200 million in 2006. In addition, tenants who have lived in estates for more than 10 years and whose household income and assets exceed the prescribed limits, or those who choose not to declare their household assets, are required to move out. In 2006, 525 better-off tenants, including 225 families who acquired their own flats under the various subsidised home ownership assistance schemes, returned their public rental housing flats to the HKHA.

In 2006, some 4 800 families living in housing blocks due for redevelopment at Wong Chuk Hang, Shek Kip Mei and Lower Ngau Tau Kok (II) estates were rehoused. Since the launching of the HKHA's Comprehensive Redevelopment Programme in 1988, 550 housing blocks have been redeveloped and the living conditions of some 183 730 households have been improved.

In March 2006, the HKHA announced the clearance of So Uk Estate in two phases. The rehousing of Phase 1 tenants will be completed in November 2008 and Phase 2 tenants in August 2011. A total of 13 400 people from 5 000 families will be affected.

To ensure the sustainable development of public housing resources, the HKHA introduced a Total Maintenance Scheme in 2006, an innovative and proactive approach to maintaining its public rental housing estates in good order. In-flat Inspection Ambassadors are employed to carry out in-flat inspections and to arrange minor touch-up works on the spot. Works orders for major repairs will be placed immediately to ensure the defects are corrected as soon as possible. The scheme also introduces new initiatives which include the setting up of a flat-to-flat maintenance database, strengthening of research and development in building diagnostic methodology and maintenance technology, setting up a maintenance hotline and mapping out a promotional and educational plan. The scheme targets 30 estates each year.

Another initiative to sustain the existing public rental housing estates is the implementation of a Comprehensive Structural Investigation Programme. Checks are carried out on housing blocks in public housing estates which are about 40 years old or above to see if they are structurally sound and economically sustainable. For housing blocks which are structurally safe but which require improvements, appropriate works including structural strengthening, recasting or normal concrete repair will be arranged. Otherwise, demolition of the blocks will be considered. Steps will also be taken to improve the overall environment of these estates to ensure they can last for at least another 15 years.

The HKHA also undertook a series of Estate Improvement Programmes to deliver quality service and enhance the living environment of selected public housing estates. The initiatives included improvement works to meet the needs of people with impaired eyesight, installation of additional lifts, lift modernisation, lighting improvement, and provision of leisure and landscape facilities.

In 2006, 29 574 rental flats were allocated by the HKHA and the HKHS to various categories of applicants. Of these, 11 204 were new flats and 18 370 were refurbished ones: 61.94 per cent were allocated to waiting list applicants, 5.24 per cent to tenants affected by the HKHA's Comprehensive Redevelopment Programme, 0.81 per cent to families affected by clearances, 1.91 per cent to junior civil servants, 24.54 per cent to sitting tenants for transfers (including overcrowding relief), and the remainder to victims of fire and natural disasters and compassionate cases recommended by the Social Welfare Department.

Flats are allocated in accordance with the order of registration and applicants' choices of district. Applicants are required to satisfy comprehensive means tests (covering income and assets), domestic property tests and a residence rule before being admitted to public rental housing. To speed up the letting of some less popular flats, the HKHA launched the Express Flat Allocation Scheme and invited all eligible applicants on the waiting list to select a flat from among flats which have been lying vacant for a prolonged period due to various reasons. During the year, 2 044 households were successfully rehoused under this scheme.