Page 5 - Demo

Although private housing completions saw a one-off rebound in 2020, the trend of slowdown in the private housing development cycle since mid-2018 remained on course. We forecast that the number of private residential completions in the next five years (i.e. 2021–2025) will average only 15,000 units per year. This is 28% lower than the 20,900 units completed in 2020. Public housing supply in the next four years (i.e. 2021/22–2024/25) is also expected to lag behind the Long Term Housing Strategy (LTHS) target by 28%, with an annual average of 21,800 units.The shortage in supply will also cast a negative light on the quality of living, as Hong Kong people will suffer from the consequence of living in smaller and more expensive flats. It is predicted that the average gross floor area of newly completed private housing units will continue to shrink to a record low of less than 600 square feet in 2024, almost one-third smaller than in 2012 (with the assumption of 80% efficiency, this is equivalent of the saleable area being less than 480 square feet). Despite this, the trend of “nano-flats”, i.e. units that are smaller than 215 square feet in saleable area, should peak out gradually after 2022.Low housing completions in both public and private housing in the next five yearsLow quality in living with smaller and more unaffordable flats3