For years Hong Kong has been plagued by land shortages, which have taken a heavy toll on the city’s housing supply.
On Wednesday a tract of land at Kowloon Tong’s Beacon Hill was sold at a record-breaking price, indicating that the market might be getting increasingly pessimistic about land supply in our city in the medium to long term.
Such pessimism could be well-founded. According to a recent study by Our Hong Kong Foundation, Hong Kong may need an extra 9,000 hectares of land, or roughly three times the size of Sha Tin, to meet the housing needs of our growing population over the next 30 years.
But even if all government land development projects coming on stream were approved by Legco, they could only provide 5,000 hectares of land at most, the study said.
Almost all of the land plots the government has put up for sale over the past few years – most of them located in Tung Chung, Cheung Kwan O South, Tai Po and the former Kai Tak airport – were “old land” formed or reclaimed 10 to 20 years ago.
Over the past 10 years the government hasn’t reclaimed or readied much land for development.
In other words, what the government has been doing is simply tapping into its land reserve to meet market demand.
This raises a serious question: What do we do once that reserve is used up?
It won’t be too long before that day comes, according to government figures.
There are several ways of providing new land, such as developing brownfield sites in the New Territories, proposing changes in the use of land by invoking the Town Planning Ordinance, and carrying out reclamation in Victoria Harbour.
However, the Wang Chau housing project saga shows how difficult it could be for the government to tap into brownfields, let alone reclaim land from the harbor again, which is likely to meet even more fierce public opposition.
In the meantime, changing the use of land often applies to small urban land only, which is of little help in alleviating the overall land shortage.
As we can see, our city is in deep water as far as land supply is concerned, and it is time for both the government and the public to make difficult or even unpopular decisions on how to increase our land supply.
That said, we urge the administration to put forward all possible options for open discussion, thereby allowing the public to balance one choice against the others and reach a consensus over this critical issue.
This article appeared in the Hong Kong Economic Journal on Oct. 6.
Translation by Alan Lee
[Chinese version 中文版]
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