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Hong Kong is cracking down on wealthy tenants in highly sought-after subsidized public housing amid growing pressure from Beijing to expand access to affordable housing in one of the world’s most expensive property markets.
Authorities are targeting households with assets that exceed government limits. Family of four The minimum length of residence is HK$30,950 (US$3,970) and net worth must be no more than HK$590,000. The average rent for public housing is HK$2,297.
The government has hired retired police officers to investigate the tenants, some of whom drive luxury cars such as Mercedes and BMWs, and plans to offer rewards for informants.
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“Fraud has been uncovered,” a Housing Authority spokesman told the Financial Times last month, adding that authorities were inspecting car parks at housing estates after receiving complaints. In some cases, tenants have been evicted after being found to have falsely declared their income or assets.
Hong Kong, one of the world’s most unequal cities, is also one of the most housing-unaffordable: The ratio of median home prices to median household income is nearly 19, far higher than in Singapore, Britain or the United States, according to data from the Urban Reform Institute last year. Beijing claims tensions over the soaring cost of living contributed to pro-democracy protests across the city in 2019.
More than a quarter of Hong Kong’s 7.5 million people live in subsidized public housing. Apartments vary in size, but the government recommends that apartments for two or more people be at least 280 square feet. The waiting time for housing is almost six years.
In addition to public housing, more than 200,000 people in Hong Kong live in zoned units known as “coffin apartments,” most of which are less than 140 square feet and command average monthly rents of about HK$5,000.
Heron Lim, an economist at Moody’s Analytics, said Hong Kong’s public housing acts as a “critical stabilizer” and safety net for low-income workers living in a very expensive city.
Hong Kong is also under increasing economic pressure as slowing Chinese growth and a crisis in its property sector have slammed demand for land, with land sales providing about a fifth of annual government revenue.
Falling government revenues and rising construction costs have hit Hong Kong’s public housing capacity, leaving authorities in Hong Kong and Beijing pressuring tycoons and developers to provide more affordable housing.
Hong Kong home prices have fallen more than 20% since the U.S. Federal Reserve began raising interest rates in 2022, leading banks, whose currency is pegged to the U.S. dollar, to raise mortgage rates, stifling demand.
However, house prices remain high relative to incomes. Average price The rent for a 430 square foot apartment in Hong Kong is about HK$5 million.
The authorities are increasing public housing rents. 10 percent The aim this year is to raise funds to build more than 146,000 new social housing units over the next five years.
The authority is embroiled in a legal battle with the private golf club over plans to convert part of the club’s land into social housing.
Over the past two years, authorities have seized about 5,000 apartments from their tenants. [rich] “Public housing should not be given to the poor in the first place,” said a public housing tenant in his 50s after authorities inspected his housing complex.
