Soaring home prices are making more Hongkongers eye government-subsidized apartments, with many families viewing the Home Ownership Scheme (HOS) units as their only chance to have an apartment in the city.
Given the current market situation, the 2,100 HOS flats that will be rolled out at the end of the year have become hot property, with people even prepared to take salary cuts in order to be eligible to apply for the subsidized homes, Ming Pao Daily News reported Monday.
Some young couples, who have HK$50,000 combined household income per month, are opting to have one of the partners seek a demotion or salary cut in order to bring down the family income to HK$44,000, the qualifying eligibility limit for HOS flats, the paper cited sources as saying.
There are reports that some employees have chosen to take no-pay leave in order to keep the household income within the limits. They will go back to work only after they acquire an HOS flat.
Stanley Wong, chairman of the Subsidized Housing Committee, described the phenomenon as worrisome. The persistent rise in home prices has widened the base of the so-called sandwich class, he said.
Other members of the Subsidized Housing Committee hinted at an upward adjustment in the household income ceiling for the upcoming batch of HOS flats, and that the discount for the HOS price vis-a-vis private flats could also be adjusted to 40 percent from the current 30 percent.
Wong said there is a good case to raise the household income eligibility limit by 10 percent.
A 28-year-old clerk surnamed Li said a small second-hand unit on the market could cost between HK$3.5 to 4 million, and would require a monthly installment of at least HK$20,000 if 80 percent of the property price is put down for a mortgage loan for 20 years.
“We do not want to sacrifice our regular leisure travel and live a life where we have to think carefully before we eat out because of the substantial monthly contribution,” Li said, explaining why government-subsidized units would be a better deal.
The feverish conditions of the property market have created growing numbers of sandwich class people who cannot afford private flats but are also ineligible to apply for public housing resources.
In the 1990s, the Hong Kong Housing Society rolled out a Sandwich Class Housing Scheme in addition to the HOS, with a household income limit of HK$60,000 per month and the availability of a downpayment loan facility.
Dr Chung Kim-wah of Hong Kong Polytechnic University’s Department of Applied Social Sciences said it is a tragedy that young people are opting for downward move in their careers in order to qualify for public housing.
As people find that they are unable to buy a flat after working hard to acquire various professional qualifications, it makes them wonder if there is any point in moving up in society, Chung added.
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