Page 6 - Demo

We have repeatedly pointed out that the Government’s 10-year housing supply target as stipulated in the LTHS is too conservative to make up for the cumulative shortfall, let alone improve the quality of living for the public. However, even this low target will only be achieved with Herculean effort. To assess whether the Government could achieve its LTHS ten-year housing supply target, we have provided an exclusive ten-year forecast in public and private housing supply and a quantitative analysis on reaching the LTHS target. The Government has announced in the 2020 Policy Address that it had identified all the land required for 316,000 public housing units in the next ten years. However, based on our forecast, if all land supply initiatives continue to progress at the current speed, only some 277,400 public housing units could be completed in the same period. To reach the figure stated in the Policy Address by the Government, New Development Areas (NDAs) and other major land-supply initiatives will need to be completed with an expedited timeline, which is approximately two years ahead of their current schedules. In addition, the annual supply of flats from rezoning needs to be increased by 5% over the current level.For private housing, only an average of 12,000 units per year is expected to be completed in 2026–2030. This is 20% lower than the annual average of 15,000 units in 2021–2025, and fails to reach the annual target of 12,900 units in the LTHS. If the Government wishes to fulfil the LTHS target, NDAs and other major land development initiatives need to be completed one year ahead of the original schedule, and supply from private development needs to deliver 5% more units each year. Even so, the forecast supply would still be lower than the 18,000-unit level stipulated in the LTHS before the Government adjusted the ratio of the public/private housing supply target in 2018. Our reason for comparing against the previous LTHS target is that, although we agree with the Government’s policy of shifting the public-private mix from 60:40 to 70:30, we believe it would be more advantageous if the total housing supply target is raised at the same time. Otherwise, the revision is simply “robbing Peter to pay Paul”.The 10-year LTHS housing supply target will only be achieved with Herculean effort4