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HONG KONG, Oct. 12, 2011 /PRNewswire-Asia/ -- The Royal Institution of Chartered Surveyors (RICS) Hong Kong welcomes HKSAR Government’s favorable response to Hong Kong residents’ demand for housing, with the reintroduction of flats under the House Ownership Scheme (HOS) to cater for those in the ‘sandwich’ class. Any new measure must be implemented in the short term to offer certainty to the housing market.
The Policy Address states that banning sub-divided flats “across the board” is not a solution; RICS urges for prompt enforcement action to be taken against sub-divided flats and cubicle apartments which have given rise to structural, fire and hygiene safety problems. We support the Government’s focus on public rental housing production which provides a safety net for the most vulnerable in society.
Home Ownership Scheme and My Home Purchase Plan
Under the new Home Ownership Scheme, RICS believes that priority should be given to increasing home supply instead of suppressing property prices. According to the Policy Address, 2,500 flats will be introduced in the first wave of new HOS. This can relieve the shortage of flats. A mechanism will also be launched to suspend introduction of HOS flats in line with market situations, when necessary. RICS believes that both the number of housing units and the policy have small impacts on the private property market. RICS suggests government review its long term housing policies regularly, whilst reserving sufficient suitable land for HOS, in order to avoid the accusation of intervening the housing market and competing with developers. At the same time, RICS supports government to provide housing and rental allowances to public rental housing waiting list applicants, so as to address housing problems of lower income groups. Besides, RICS believes land supply for small- and medium-sized flats and non-luxury housing is not sufficient. RICS recommends that the government launch more land plots to tackle middle class’s demand for housing.
RICS also welcomes the government’s confirmation that 1,000 flats will be provided by the first development project of My Home Purchase Plan. However, RICS believes construction needs to be speeded up, and more measures are needed to relieve home supply. Careful consideration of details such as setting rents and sale prices is important when implementing the scheme. Transparency must be ensured in the pricing of flat units, with comprehensive references to prices of nearby properties, so that the new flats will not affect the prices of nearby homes, while catering for homebuyers’ affordability.
Land Development and Accumulation
RICS welcomes the announcement to examine “Government, Institution or Community” (GIC) sites to avoid the under-utilisation of without specific development plans, Land zoned for GIC uses should be considered in the broader context of Hong Kong’s long term needs. GIC facilities can be compatible with prime office space, creating mixed use developments, incorporating commercial, retail and residential elements.
Shortage of office supply dampens HK’s competitiveness
Policies to review land supply in the territory must take into account the sustainable growth of businesses in Hong Kong.
A study published by RICS last week demonstrates that businesses opt to remain in Central in order to compete effectively. RICS recommends a range of measures to increase supply in Central, including planning controls to amalgamate smaller sites and transferring air rights. However, we welcome the announcement that Government will relocate its offices to Kai Tak and release sites of Government facilities for commercial development.
We are particularly pleased to see that Government has adopted our recommendations to enhance the connectivity of Kai Tak, as well as the relocation of Government offices, which will function as a catalyst to introduce vibrancy to this district. Decentralized hubs can alleviate supply shortages, although they must be equipped with accessible transport infrastructure, ancillary facilities such as banking and food and beverage outlets, as well as attractive streetscapes to cater to Grade A occupants. Importantly, any development should have high quality building facilities and management, including larger floor plates to attract prominent businesses.
Expedite the progress of urban renewal
RICS believes that the new urban renewal policies lack flexibility. Currently, the Urban Renewal Authority (URA) is redeveloping properties in collaboration with private developers. However, with profitability being the major concern of private developers, districts with relatively low profitability and small scales are often not targeted. Moreover, with considerable amount of compensation to residents, progress of urban renewal remains sluggish. RICS recommends that the government consider compensating in the form of ‘flat for flat’, or providing compensation with the option of relocating to the same district. All these measures help the URA lower the demand for capital, and thus expedite the progress of urban renewal and ultimately improve living conditions of Hong Kong citizens.
Commenting on the Policy Address by the Chief Executive, MrKK Wong, Chairman of RICS Hong Kong said, “RICS is pleased that our views on office supply have been taken into consideration in this year’s policy address. We welcome the announcement on Government relocating to Kai Tak – this is an important prerequisite for the success of Kai Tak, and will release prime sites for commercial development. We urge Government to go further and make the best possible use of its existing portfolio. We believe that the core CBD should not be neglected; in an RICS report launched last week, we demonstrated that businesses opt to remain in Central because of corporate image despite significantly higher operational costs.”
About RICS & RICS Asia
RICS is the world’s leading qualification when it comes to professional standards in land, property and construction.
In a world where more and more people, governments, banks and commercial organisations demand greater certainty of professional standards and ethics, attaining RICS status is the recognised mark of property professionalism.
Over 100,000 property professionals working in the major established and emerging economies of the world have already recognised the importance of securing RICS status by becoming members.
RICS is an independent professional body originally established in the UK by Royal Charter. Since 1868, RICS has been committed to setting and upholding the highest standards of excellence and integrity – providing impartial, authoritative advice on key issues affecting businesses and society. RICS is a regulator of both its individual members and firms enabling it to maintain the highest standards and providing the basis for unparalleled client confidence in the sector.
The RICS Asia supports a network of over 11,000 individual professionals across the Asia Pacific region with an objective to help develop the property and construction markets in these countries, by introducing professional standards, best practice and international experience. It promotes RICS and its members as the natural advisors on all property matters. It also ensures that services and career development opportunities are provided to members.
The RICS Asia region covers national associations and local groups locating in Brunei, Malaysia, Singapore, Thailand, The People’s Republic of China and the SAR Hong Kong. It also has members working across the region such as Bangladesh, Bhutan, Burma/Myanmar, Cambodia, Indonesia, Japan, Kiribati, Laos PDR, Macao, Mongolia, Nepal, North Korea, South Korea, Taiwan, The Maldives, The Philippines, Timor East and Vietnam. For more information, please visit: www.ricsasia.org.
