Virus, Red Tape, Threaten Housing Supply: Think Tank

The Our Hong Kong Foundation on Monday warned of a significant slowdown in the construction of new public and private housing in the territory – caused both by excessive government red tape and the coronavirus pandemic.

The think tank – founded by former Chief Executive Tung Chee-hwa – said in its annual review of the SAR’s land and housing supply that it expects the administration to only be able to build 20,000 public housing flats over the coming four years – 32 percent lower than its own target.

It also lowered its own estimate for the number of new private-sector flats from 18,000 to 16,000 a year, citing a recent slowdown in construction activity.

“The numbers that we have put out actually haven’t incorporated the [effects of] Covid-19 yet”, Ryan Ip, the foundation's head of land and housing research, said.

“But we have seen quite a lot of anecdotal evidence that the Covid-19 is actually having an impact on the construction progress of private housing.”

Ip explained that some construction sites have been shut down during the health crisis, while a lot of construction materials aren’t being delivered to where they’re needed.

The foundation's deputy executive director, Stephen Wong, said a more persistent problem is the government's ‘time-consuming’ and ‘bureaucratic’ land rezoning procedures.

“After you find land, you need to expedite your process so that your land is ready to [be] made into private units to meet the target – even if the target actually underestimate [public demand]”, Wong said.

He noted that even for public flats, the government has failed to meet its own target for seven years running – bogged down by various procedures that required even after the land is rezoned – such as land clearance, resumption, and the need to conduct engineering studies.

The foundation says the government should make “every possible move to expedite the pace of land development, and to increase housing supply by removing red tape involved in the process.”

It suggests that current procedures should be streamlined, and a central, inter-departmental team should be set up to help facilitate planning and land development applications.