Hong Kong's embattled leader falls short on housing promises

Sun Jan 18, 2015 4:21pm EST
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By Yimou Lee

HONG KONG (Reuters) - Hong Kong leader Leung Chun-ying took power in 2012 with a pledge to make housing more affordable, but since then both home prices and the waiting list for public housing have jumped by a third, stoking calls for him to step down.

While demands for greater democracy paralyzed parts of Hong Kong in 2014, many protesters were also voicing their anger over what they see as a widening wealth gap that has kept homes out of the reach of many of the city's 7.2 million people.

"If we don't eat, drink and go outside, we still cannot afford to buy a flat," said Kelly Chan, a 28-year-old manager of a legal department at a Singaporean bank in Hong Kong. Chan and her boyfriend, who earn a combined monthly salary of HK$100,000 ($12,900), have spent one fruitless year looking for a small apartment of about 400 square feet (37 square meters).

"We are very frustrated at government policy. The rents and the money you have to pay for a flat have increased so much."

In a city where the monthly average wage is HK$14,100, many share that frustration. There are about 200,000 people living in what the government calls "inadequate housing", including cubicle apartments and cage homes - wire mesh hutches stacked on top of each other.

Although Leung has unveiled a series of property curbs since late 2012, including a 15 percent tax on purchases by foreigners, the city's red-hot real estate market has showed no signs of cooling. Hong Kong home prices, which have risen about 130 percent since 2008, continued to break records last year.

More than a quarter of a million applicants are still on a waiting list for public housing, a 32 percent increase from June 2012, just before Leung took office. According to government data, the number of people sleeping on the street has risen to 746 from 511 over the same period.

In an annual policy address on Wednesday, Leung reiterated he would seek to boost the supply of land in the former British colony, where housing is packed into just 30 percent of the territory.   Continued...

Hong Kong Chief Executive Leung Chun-ying speaks at a news conference following his annual policy address at the Legislative Council in Hong Kong January 14, 2015.  REUTERS/Bobby Yip