HK homes out of reach for most

HONG KONG: About 60% of the people in Hong Kong have no hope of buying any property in the next 10 years if prices remain at existing levels.

That is the finding of a University of Hong Kong Social Sciences Research Centre survey commissioned by Citibank. The survey looked at demand for property ownership, and involved interviews with 1,063 people aged above 18 in the first half of last month.

About half of the respondents said they believed they would be able to own a flat at some point in the future if they saved regularly. But only 20% intending to buy a flat were confident they would do so in the next five years.

If property prices stayed at the existing high levels, 60% of the respondents said they had no hope of buying property in 10 years. Only a quarter said they hoped to do so even if prices remained the way they were.

The average property price of the major 50 housing estates monitored by property agency Ricacorp Properties has risen 19% so far this year. About half of the respondents said they expected prices would go up even further in the next two years, while 26% said they believed prices would stay flat. Only a quarter of the respondents believed property prices would drop in the next two years.

Although people found it difficult to buy property at these prices, not everybody believed the government had a duty to help. About 42% of the respondents said they believed it was the government's responsibility, while 34% did not.

Lawrence Lam Chi-kong, director of consumer lending at Citibank (Hong Kong), said more than half of the respondents aged 18 to 29 and 60 or above said it was the government's duty to help them buy homes. Only 34% of respondents aged 30 to 59 agreed.

About one-third of the respondents needed support from parents to buy their first property.

The survey found that most first-time buyers were targeting flats of 500 to 700 square feet with prices ranging between HK$1.9 million and HK$2 million (RM758,981.04 and RM798,927.41).

They said they felt comfortable to pay at most 20% to 30% of their household incomes towards a mortgage.

Jeffrey Ng Chong-yip, a director at property agency Midland Realty, said property prices in Kowloon and Hong Kong had risen significantly and it was virtually impossible to buy a flat in new projects.

"Old buildings in Kowloon and Hong Kong Island are also beyond reach. Most people can buy flats in Tuen Mun and Tin Shui Wai. Tseung Kwan O also has flats selling for HK$2 million, but they are about 400 sq ft only," he said.

CB Richard Ellis senior managing director Craig Shute said the government must resume the Home Ownership Scheme to cool down the market.

He believed the government would speed up the development of MTR Corp and Urban Renewal Authority sites, increase land supply on the Land Application List and hold more regular auctions to help buyers. — South China Morning Post