A few days ago I announced the 2015-16 Land Sale Programme (LSP), which comprises 29 residential sites capable of providing about 16 000 flats. Other sources of supply include railway property development projects (1 880 flats under the West Rail property development project at Yuen Long Station and 5 350 flats at LOHAS Park owned by the MTR Corporation Limited), 840 flats under Urban Renewal Authority (URA) projects, and about 4 400 flats under private development or redevelopment projects (based on average figures over the past decade). Combining these sources of supply, the total potential private housing land supply in the next financial year is estimated to have the capacity to produce about 28 000 flats, while the Government’s private housing land supply target for the next financial year is 19 000 flats.
Among the 29 private residential sites, two are on Hong Kong Island, five are in Kowloon and 22 are in the New Territories. In terms of site area, six sites are less than 0.5 hectare, 14 are 1 hectare or more and nine are in between. In terms of the number of flats that can be produced, 10 sites could provide more than 500 flats each, 16 sites 100 to 500 flats each, and three sites less than 100 flats each.
In the few days after the announcement of the LSP, there were some public concerns and misunderstandings as to whether next financial year’s private housing land supply target (19 000 flats) can be met. I would like to share with you a couple of points.
(1) While 15 sites out of the 29 require rezoning, it is already a significant improvement compared with last year.
In fact, it is the Government’s established practice to include in the LSP those sites that are expected to be available for sale within the year, including those which require rezoning or other procedures. Among the 34 sites in the 2014-15 LSP, 21 needed to be rezoned or have their development intensity increased. Among the 29 residential sites earmarked for the next financial year, 14 (about 7 900 flats) do not require rezoning. Of the remaining 15 sites (involving about 8 000 flats) that require rezoning, the rezoning procedure for eight sites has commenced, five of which (involving about 3 500 flats) have already obtained the Town Planning Board’s (TPB) support. In other words, barring unexpected circumstances, sites capable of producing more than 10 000 flats could be supplied to the market. In addition, as mentioned above, there are also other supply sources – railway property development projects, URA projects, private redevelopment and development projects and so on. The rezoning of the remaining seven sites will commence gradually and we are determined to get the work done.
Furthermore, the LSP is not carved in stone. We will continue to make all-out efforts to identify sites and add new sites to the LSP, taking into account the actual situation. For example, in 2013-14, we added a total of eight residential sites to the LSP, while five sites were added in 2014-15.
(2) The impact of the TPB’s decision on the LSP
On February 13, 2015, the TPB examined the amendments to the Tai Po Outline Zoning Plan and approved the rezoning of six sites for residential use (about 9 200 public and private residential flats in total with a public-private split of 7 to 3), while recommending reversion to Green Belt zoning for the remaining two sites (about 1 300 private residential flats in total). As an independent statutory body, the TPB takes into consideration all relevant objective planning factors when examining land rezoning proposals. In other words, the TPB handles matters objectively and fairly, and is not a “rubber stamp”. Although our rezoning work is difficult, we manage to make certain progress. We will continue to explain proposals to local people, so as to solicit support and understanding from the district and the community. We will also continue to replenish land supply with suitable sites so as to maintain a steady supply of housing land.
(3) Does the LSP address market demand for small and medium-sized flats?
In the LSP for the fourth quarter of 2014-15, we did not impose any flat number requirements. In the LSP for the first quarter of 2015-16, no such requirements were imposed either. One of the reasons is that some sites are small, thus not suitable for imposing such requirements. Another reason is that such requirements have become unnecessary as the market has already positively responded to the demand for small to medium-sized flats. Some suggest that the Government should introduce minimum flat number requirements in order to boost the supply of small flats. We consider this approach inappropriate. Apart from the two reasons mentioned above, we also hope to give the market sufficient room and flexibility to provide flats for first-time property buyers, and at the same time supply bigger flats to address public demand for trading up flats.
Nonetheless, this does not mean that we give up the minimum flat number requirements. The Government will continue to consider setting minimum flat number or other requirements in land sale conditions according to market conditions and the characteristics of individual sites.
In future, we will continue to expedite and increase land supply through a multipronged approach to address Hong Kong’s various social and economic needs. At the same time, we will monitor the market situation closely and spare no effort in identifying land for timely supply to the market.
1 March, 2015
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