23 February 2019
There are about 90,000 households living in subdivided flats in Hong Kong. Photo: AFP
There are about 90,000 households living in subdivided flats in Hong Kong. Photo: AFP

Government-funded subdivided flat plan makes further progress

At the beginning of July Secretary for Transport and Housing Frank Chan Fan suggested that the government provide funding for non-profit organizations to furnish affordable, safe, hygienic and not-for-profit subdivided flats for low-income families.

Less than one month after, Chan’s proposal has already made remarkable progress: the Urban Renewal Authority (URA) has announced it is planning to rent out 14 of its residential apartment units on Soy Street in Mong Kok to the Hong Kong Council of Social Service (HKCSS) at just 50 percent of their rateable value, in order to allow the organization to provide cheap and transitional housing for grassroots families.

Chua Hoi-wai, chief executive of the HKCSS, said they had discussed the initiative with the URA for several months already, and Secretary Chan’s eagerness to push for “government-funded” subdivided flats had proven instrumental in expediting the project.

Yet, he also pointed out that since renting out subdivided flats to the public could give rise to some legal issues, his organization would proceed with caution.

It is said that the last administration under Chief Executive Leung Chun-ying had also seriously studied the feasibility of providing government-funded subdivided flats for the underprivileged, under which tenants would be allowed to rent the flats at below market rates for a limited period of time, say, two or three years.

However, the idea was eventually shelved because it simply raised too many issues and questions, such as what the authorities would do if the tenants refused to vacate their flats.

Besides, while it was estimated that the government could at most provide some 3,000 subdivided flats every year, there are at least 90,000 households living in subdivided flats, and their numbers continue to grow.

The CY Leung administration finally concluded the idea wasn’t worth pursuing: the number of subdivided flats it was going to provide would be no more than a drop in the bucket.

The same concern has also caused the Youth Hostels program proposed by former Chief Executive Donald Tsang Yam-kuen back in 2011 to grind to a halt. Under the proposal, young people aged between 18 and 30 would be eligible to apply for tenancy in these hostels for a maximum period of five years.

The administration later thought there would be a lot of potential problems, including how to deal with tenants who refuse to move out after their fixed-term tenancies expire, and so the project was shelved.

As far as the HKCSS is concerned, it said it had never heard of any study carried out by the previous administration on the matter.

As to whether the initiative could really make a difference given its tiny scale, the organization said “it is at least better than nothing”.

This article appeared in the Hong Kong Economic Journal on July 31

Translation by Alan Lee with additional reporting

[Chinese version 中文版]

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Columnist of Hong Kong Economic Journal.

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