Hong Kong Developer Mulls Subsidized Flats to Ease Homes Crisis
(Bloomberg) -- One of Hong Kong’s top property developers is weighing plans to offer subsidized apartments to eligible buyers in an unprecedented move that shows how local tycoons are taking new steps to tackle the city’s housing crisis.
New World Development Co. is studying a new model for private enterprise to provide homes that are priced lower than the market level, according to the company.
The move is being led by the developer’s non-profit organization New World Build For Good which was set up to explore solutions to Hong Kong’s housing crisis in September. It is unclear how much cost the social housing enterprise will bear and whether the government or other developers will play a role.
Local authorities and builders are coming under mounting pressure to alleviate the city’s housing crunch after Beijing marked out the Asian financial hub’s expensive residential real estate market as a priority that needs to be tackled. Previously, projects to help people with a lower income get on the property ladder have been initiated and sold by the government.
New World’s plan aims to allow the city’s younger generations to purchase homes in an affordable way, as housing and income inequality have become flashpoints for social unrest.
Hong Kong is already planning a massive urban development on the border with China. That may ease pressure on the world’s least-affordable housing market that Chinese officials consider a catalyst for 2019’s mass protests, which led to the imposition of a national security law.
The new “Northern Metropolis” will eventually provide homes for as many as 2.5 million residents, or a third of the city’s current population.
Since the mass protests, Hong Kong’s major developers including New World have also donated farmland for the development of homes for the underprivileged that are waiting for public housing.
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