HONG KONG: The government should consider resuming the building of flats under the Home Ownership Scheme (HOS) if the working class finds it hard to afford private flats, said an Executive Council member.

Anthony Cheung Bing-leung, also the chairman of the Housing Authority's Subsidised Housing Committee, said, "if it is found that the ordinary working class residents cannot afford private flats, we should certainly consider the issue of resuming the construction of flats under the HOS for the stability of our society."

Under the scheme, households too poor to afford private home purchases can buy flats at subsidized prices.

But the Housing Authority has suspended the building and selling of those flats since 2003. It wasn't until January 2006 that the authority decided to resume selling vacant flats from 2007. But the construction is still suspended.

"Flats under the HOS can be an alternative for the public", Cheung said.

He said if more public housing tenants who are financially solvent can buy flats under the HOS and then move out, then those who are poorer and in dire need can be assigned public flats sooner.

Cheung also said some other committee members share his view and think that the government should consider resuming the construction of flats under the HOS.

Chief Executive Donald Tsang Yam-kuen earlier said the exorbitant prices paid for luxury homes will not trickle down to the mass market.

But Cheung, countering this, said, "some flat owners may make reference to the prices of luxury flats when they put their flats for sale."

"We should not exaggerate the impact of the resumption of building flats under the HOS on the prices of private flats," he said.

Secretary for Transport and Housing Eva Cheng told lawmakers Friday that it is difficult to help restrain surging housing prices of private flats by increasing the supply of flats under the HOS.

Speaking in a special meeting of the Legislative Council's housing panel, she said, "even if we build more blocks under the Home Ownership Scheme, it may not be possible to curb the rising housing prices (of private flats). The markets are different."

Wong Leung-sing, the associate director of Centaline Property Agency, also said it is unnecessary to resume building flats under the HOS.

"Some mistakenly think that the surging prices are due to shortage of supply, so they keep calling on the government for action," he said.

But Wong said he thinks resuming the building of flats under the HOS will be just at the expense of taxpayers.

China Daily

(HK Edition 10/24/2009 page4)