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1. Recognize the Facts:

Shortage of Land and the

Urgency for a Solution

The previous part of this study elaborates on the “Subsidized Housing
Scheme”, a policy proposal aimed at assisting the public to purchase
their own properties by reforming our housing policy. The said scheme
strives to improve the efficiency of the current public housing system
and the liquidity of the overall housing market, ultimately allowing more
Hong Kong families to share the fruits of economic prosperity in the long
run.

Housing problem is after all, a consequence of the shortage of land
supply and therefore they are inextricably linked. Hence, this part of the
research shall discuss the issues of land supply in detail and propose
policy recommendations. However, the society seems to have
insufficient understanding of the facts on (a) the severity and urgency of
the shortage of land supply and (b) that land development far
transcends the area of housing. In view of this, this chapter begins with
data and facts related to a series of socio-economic issues caused by
the shortage of land supply, as a background of the study.

1.1. The fact: shortage in land supply

At the macro level, it is indisputable that land creation has significantly
slowed down in the past decade. The total area of developed land in Hong
Kong had increased by 7,800 hectares from 1995 to 2004. However, the
increment has dropped sharply to 1,100 hectares in the past decade.
With a drastically slower pace and shrinking scale of land creation, a
substantial reduction in the supply of various properties has followed.
This has foreshadowed the social and economic problems the city is
facing today (Figure 1).

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