Housing in Hong Kong varies by location and income. More than 7 million people live on about 1,108 km2 (427 mi2) of land in the region, making it one of the densest places in the world.
History
Housing by types In 2016 the total Hong Kong population was 7.3 million. According to the 2016 by-census, the population breakdown by type of housing was as follows: +Breakdown of housing by population percentage, 2016TypeCategoryIncludes%PermanentPublic Rental HousingPublic Rental Housing units (Hong Kong Housing Authority and Hong Kong Housing Society units), Interim Housing units29.1%Subsidized Home Ownership HousingTenants Purchase Scheme units with alienation restrictions, Home Ownership Scheme and other subsidised units with alienation restrictions (Housing Authority or Housing Society units)15.8%Private Permanent HousingPrivate residential flats:
Former subsidised sale flats,
Ordinary private residential flats,
Other quarters in private permanent housing:
Villas, bungalows and modern village houses,
Simple stone houses/Traditional village houses,
Staff quarters53.2%Non-domestic HousingQuarters in non-residential buildings, Collective living quarters1.2%TemporaryTemporary HousingTemporary quarters0.7%
Segmentation
In the high-end market, the Peak is ranked the 3rd most expensive city in the world in 2007 with a square foot per unit pricing of US $2,008 behind London and Monaco.
Types Housing estates Public housing estate Private housing estate
Traditional and historical housing Tong Lau Pang uk Walled villages of Hong Kong Kowloon Walled City
Sub-standard housing Subdivided flat Cage home
Policies Land use According to the government's 2020 survey, of the 1,114 km2 (111,400 hectares) of land in Hong Kong, a total of 79 km2 (7,900 hectares) is allocated for residential purposes. Of that 79 km2, the breakdown is as follows:
Private residential (excludes village housing): 27 km2 (2,700 hectares), 34.2% Public residential (includes subsidized housing and temporary housing area): 17 km2 (1,700 hectares), 21.5% Village housing: 35 km2 (3,500 hectares), 44.3%
Though village housing occupies 44.3% of all residential land, only 7% of the population lives in it, with the other 93% of the population living in the other 55.7% of residential land. This means that non-village housing has, on average, about 10.6 times the population than village housing, for the same amount of land area.
Lease modification Land owners in Hong Kong who wish to change the use of land they held, must pay a land premium charge to the government for changing the use of the land they leased from the government. The premium needed to be paid is supposed to represent the higher value in the land's new usage.
Land selling
Public housing
Public housing is a major component of the housing in Hong Kong. About half of Hong Kong residents now live in public housing estates () and other tower blocks with some form of subsidy. The history of public housing in Hong Kong can be traced back to the 1950s, where masses of people surged into Hong Kong due to political turmoil on the mainland. This led to a drastic increase in the number of squatters. Fires were common in these unhygienic and cramped makeshift homes. In 1953, a fire in Shek Kip Mei destroyed the shanty homes of approximately 53,000 people. In response the Hong Kong Government commenced a programme of mass public housing, providing affordable homes for low income citizens.
Several subsidized home ownership programs have been implemented, including: Home Ownership Scheme, Flat-for-Sale Scheme, Tenants Purchase Scheme, Sandwich Class Housing Scheme and Private Sector Participation Scheme.
Supply target The government sets a Long Term Housing Strategy every year, which plans housing units for the next 10 years. In 2014, the government's target for public and subsidized flats vs private housing units was set at 60% and 40%. In 2018, the target was changed to 70% public and 30% private. Under that ratio, the government projected 450,000 total flats to be developed in the 10 years after 2018, with 315,000 to be public, and 135,000 to be private.
SCMP noted that these were only targets, and that "Since 2014, the government has never hit its target of building enough public flats. The public housing units provided in the past four years only accounted for 47 per cent of the actual number of homes built, falling short of the 60 per cent target." Additionally, a member of the Democratic Party stated that without increasing land supply, the government would continue to fall short of its target.
In December 2020, Secretary for Transport and Housing Frank Chan announced that the next target would be 430,000 total units over the next 10 years, down from the 450,000 target specified in 2018. This means an annual target of 43,000 total units, with the same 70% public (30,100) and 30% private (12,900) target ratio. In December 2021, the target set in December 2020 was reconfirmed for the next 10 years.
In July 2021, Adam Kwok Kai-fai, an executive of Sun Hung Kai Properties, suggested that the 10 year targets did not have accountability, and that officials should set up a committee to oversee progress towards meeting the 10 year targets, with a government official held accountable if the targets were not met.
Expected shortage The Hong Kong government in 2016 estimated that over the next 30 years, Hong Kong will face a shortage of approximately 1,200 hectares for housing.
In 2021, the shortage was revised upwards to 3,000 hectares over the next 30 years.
Affordability Hong Kong's home prices top the list of least affordable markets among major world cities according to American research institution Demographia's latest report in January 2015. The Demographia International Housing Affordability Survey 2015 includes 378 property markets around the globe, generating Median Multiples according to the proportion of average property price to median household income. Results are categorized into 4 levels: Affordable (Below 3 times), Moderately Unaffordable (3.1 to 4 times), Seriously Unaffordable (4.1 to 5 times) and Severely Unaffordable (5.1 times and over). Hong Kong falls into the grading of 'Severely Unaffordable', with the highest recorded index of 17.0 since the report commenced 11 years ago. Second on the list was Vancouver with an index of 10.6, still significantly lower than HK.
A CBRE report from 2019 lists Hong Kong as having the highest average property price in the world. As of June 2021, an average 500 sqft apartment cost HK$9.44 million in Hong Kong Island, HK$8.32 million in Kowloon, and HK$7 million in New Territories; an average family would have to save for about 20.7 years to pay for such a unit.
According to the 2014/2015 Household Expenditure Survey, housing accounted for an average of 36% of average monthly household expenditure, with utilities accounting for an additional 3%.
The home ownership rate peaked at 54.3% in 2004. The median floor area of households as of 2016 is 430 sqft, while the floor area per capita is 160 sqft.
A local think tank, New Youth Forum, said in October 2023 that buying power for youth had been halved over the past 20 years, due to increases in housing prices. The think tank also opposed recent calls to eliminate anti-speculation taxes.
Monetary Authority chief executive Joseph Yam Chi-kwong warned that the city's policy on land and high property values would prevent economic growth.
Proposed causes of high housing cost
There are many contributing factors to Hong Kong's extremely high cost of housing. Though Hong Kong's economy is historically based on positive non-interventionism, the government intervenes heavily in housing, disrupting free-market economics. The high costs of housing have caused some to live in very small subdivided flats, sometimes referred to as "coffin homes", with an estimated 110,000 subdivided units in Hong Kong, housing 220,000 people. Those living in poor conditions (subdivided flats, rooftop huts, industrial or commercial buildings, cubicles, and bed spaces) are estimated to house 127,000 households over the next 10 years.
Several reasons for the high costs and lack of free-market economics of the housing market have been outlined by the media, and are explained below:
Opaque pricing When new units are sold by tender, the current highest bid is not revealed to the buyers, a method which has been criticized as being unfair to buyers and also tends to increase prices.
A reader's letter to SCMP also stated that prices are also not clear, as developers offer a commission to property agents on sales, a portion of which is passed back to the buyer in the form of a rebate, which may artificially inflate prices as well.
Supply constraint Small House Policy The Small House Policy, introduced in 1972, guarantees every male indigenous villager a grant to build his own house. It has been described as an unsustainable policy due to shortage of land; as noted by a professor at Chinese University, "The problem that has to be faced is that of sustainability. Sooner or later, there will not be enough land to satisfy a potentially endless pool of claimants." In addition, the former Secretary for Housing, Planning and Lands, Michael Suen Ming-yeung, has also said that the policy is unsustainable, and that "They will keep producing new generations; the policy cannot be allowed to continue. People have to agree on a date that the small house right should end, in ten or 20 years - to allow enough time for preparation so that the benefits of current right holders are not hurt." Though Carrie Lam has called for an end to the policy, the Heung Yee Kuk, which represents villagers, has spent resources to challenge changes to the policy. According to a SCMP report, 5,000 hectares, representing about 20% of all urban space in Hong Kong, is locked up for these low-rise developments, rather than being used for high-rise developments which would increase the supply of housing.
Also, according to the Heung Yee Kuk, there are approximately 2,400 hectares of tso/tong land, land which is held in the name of villager clans and families, many of which are underutilized. In May 2021, SCMP noted how difficult it is for tso/tong land to be sold by villagers and bought by developers, as it requires unanimous consent of a villager clan/family, rather than a majority. In Carrie Lam's 2021 Policy Address, the government pledged to set up a working group to address the difficulties of getting unanimous consent for the land, as well as vacancies of managers for the land.
In May 2021, Liber Research Community released another report titled Research Report on Development Potential of Vacant Small House Land, which determined that of a total of 3,380 hectares of village-type land, 1,548.8 hectares were idle and privately owned, with a separate 932.9 hectares of idle land belonging to the government, totaling 2,481.7 hectares. Additionally, it found potential collusion between developers and villagers on 149.1 hectares of idle privately owned villager land.
Liber Research Community also found approximately 10,500 village houses built illegally, via a method known as tou ding.
In February 2024, an opinion article from SCMP said that villagers had built illegal gardens, charged others money for parking cars on government land, and built numerous other illegal structures.
Chinese military land usage The Hong Kong Garrison of the People's Liberation Army, the military force of China, occupies 2,750 hectares of land across Hong Kong, land that has been reported to be underutilized and could be used for housing instead. In particular, the Castle Peak / Tsing Shan firing range occupies 2,263 hectares, or around 80% of all PLA land area.
Brownfield sites