Home Ownership Scheme

Home Ownership Scheme (Chinese: 居者有其屋計劃, HOS for short) is a housing programme carried out by Hong Kong Housing Authority in Hong Kong. It was instituted in the 1970s as part of the public housing system for those who were not entitled to, or unwilling to live in, public housing.

Now the poorer members of the public can buy as well as rent residences from the Government. Under this scheme, the Government:
*sells apartment flats at a price lower than the market, discounts usually between 30 and 40 percent; [ [http://sunzi1.lib.hku.hk/newspaper/view/12_10.02/593.pdf Discount of 37 pc for flat buyers] , South China Morning Post, March 28 1992]
*provides subsidies on the land value; and
*restricts re-selling in the second-hand market.

For certain projects, the Housing Association has entered into arrangements with local private developers to provide property for sale under the Private Sector Participation Scheme (PSPS) (私人機構參建居屋計劃 or simply 私人參建計劃).

History

The first such plan was launched in 1978 and the first batch of flats became available in 1980, the first estates being Yuet Lai Court (悅麗苑) in Kwai Chung, Shun Chi Court(順緻苑) in Kwun Tong, Shan Tsui Court (山翠苑) in Chai Wan, Chun Man Court (俊民苑) in Kowloon City, Sui Wo Court (穗禾苑) in Shatin and Yue Fai Court (漁暉苑) in Aberdeen.

Average unit selling prices were HK$120,000. However, citing the fact that flats from the Mei Sun Lau development were selling at prices above the prevailing market prices, press favourable to the Chinese authorities criticised the Government of profiteering from this scheme. [cite web
title = Govt Will Gain Most From Homes Scheme | date = March 8, 1977
publisher = The Gist | url=http://sunzi1.lib.hku.hk/newspaper/view/12_02.01/114368.pdf
accessdate = 2007-01-29 ]

In 1987, forecasting that the demand for home-ownership was on the rise, the Government launched a plan to redevelop the older housing estates, and introduced a greater choice of apartments available for purchase by public housing tenants. Initially, 2,000 scheme members would be given a HK$50,000 interest-free loan with which to make the downpayment on their new private-sector homes. [ [http://sunzi1.lib.hku.hk/newspaper/view/12_01.04/113867.pdf $20b plan to solve housing problem] , To Chi-hak & Esme Lau, Hong Kong Standard, April 9, 1987]

In December 1991, there was a huge rush to buy 6,452 Housing Authority properties in 17 projects. Flats were to be sold at a discount of 40%, the most attractive for several years. The cost was approximately one-third compared with properties in similar private developments. [ [http://sunzi1.lib.hku.hk/newspaper/view/12_10.02/582.pdf Big rush for new release of HOS flats] , Ng Kang-Chung, South China Morning Post, December 18 1991]

hort piling

In 2000, the scheme was caught up in a short-piling scandal which resulted in the resignation of Housing Authority Chief Rosanna Wong, and a censure for Housing Director Tony Miller. [cite web
last = Kwok | first = Lilian | title = Firm to be sued for piling faults
date = July 4, 2000 | publisher = The Standard
url=http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=25872&sid=&con_type=1&d_str=20000704&sear_year=2000
accessdate = 2007-01-29 ] The construction of 2 blocks of Yu Chui Court in Shatin was delayed as it had to be demolished and rebuilt at an estimated cost of HK$250 million. The Wai Kee Group was implicated, and some of its companies were delisted from Government projects following the pubilcation of the Strickland Report.

Market distortion

After acquiring housing units at a discount to the prevailing market, owners of HOS and TPS units are allowed to trade them in the secondary market after three years without paying subsidised land premium (normally 35-50 per cent discount to market). They have complete freedom to sell on the open market after five years. [Paris Lord, [http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=37925&sid=&con_type=1&d_str=20021105&sear_year=2002 In search of a homes revival] , The Standard, "November 5, 2002"] In 2002, developers complained of weakness in property prices, claiming the housing marketplace was largely distorted by excessive unfair competition from schemes such as the HOS. IT was pointed out that a public rental tenant moving into a second-hand Home Ownership Scheme flat would receive three lots of subsidies.Stephen Brown, [http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=11458&sid=&con_type=1&d_str=20021114&sear_year=2002 Shackles off ... it's time for real reform] , The Standard, November 14, 2002] Government halted the PSPS, developments which were in progress at the time were either transformed into public housing, or sold off to private developers. [cite web
last = Lord | first = Paris | title = In search of a homes revival
date = November 5, 2002 | publisher = The Standard
url=http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=37925&sid=&con_type=1&d_str=20021105&sear_year=2002
accessdate = 2007-01-29 ] The HOS was suspended in November 2002, and it was also announced that the TPS would end.

Hung Hom Peninsula controversy

One PSPS project, the 2,470 flat Hung Hom Peninsula built by New World Development and Sun Hung Kai Properties, [cite web
author = Colum Murphy and Sylvia Hui | title = Legislation to block flats demolition ruled out
date = December 03, 2004 | publisher = The Standard
url=http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=14546&sid=&con_type=1&d_str=20041203&sear_year=2004
accessdate = 2008-08-10 ] was sold for a below-market land premium of HK$864 million to New World Development, who subsequently sold off half share to Sun Hung Kai. In 2004, the consortium announced the demolition of these buildings to make way for luxury apartments, to be faced with huge popular outcry about the needless destruction of "perfectly good buildings" to satisfy "corporate greed". In an unprecedented about-turn, the developers withdrew the plan on December 10, 2004. [cite web
last = Ng | first = Michael & Teddy | title = Demolition of Hung Hom flats scrapped
date = December 11, 2004 | publisher = The Standard
url=http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=14974&sid=&con_type=1&d_str=20041211&sear_year=2004
accessdate = 2008-08-10 ]

ee also

*List of Home Ownership Scheme courts in Hong Kong

References

External links

* [http://www.housingauthority.gov.hk/en/residential/shos/hos/0,,,00.html Information by Hong Kong Housing Authority]
* [http://www.cityu.edu.hk/hkhousing/prm/hos.htm "History of Home Ownership Scheme"] , City University of Hong Kong website
*Hong Kong Place,, zh icon [http://www.hk-place.com/view.php?id=208 part I] , [http://www.hk-place.com/view.php?id=210 part II]