Figures for the past 12 months have reassured the government that our housing policy is heading in the right direction, the Secretary for Housing, Planning and Lands, Mr Michael Suen, said today (June 19).
Addressing the Housing Conference organised by the Hong Kong Institute of Housing, Mr Suen noted that the property market had picked up, the number of negative equity cases had decreased sharply and the public and investors had regained confidence in the property market.
However, Mr Suen said, the public remained concerned about when the supply and demand situation in the property market would become more balanced.
Noting that different views were expressed on the government assessments released in October last year and in April this year concerning the supply of new flats in 2007, Mr Suen cautioned that we had to be very careful about the use of figures.
"All along, individual property agents and real estate analysts have prepared very different sets of data. These are different from ours and from each other because they use very different assumptions to cater for different target groups and for different purposes.
"Any cursory comparison of these data and forecasts will inevitable distort the real situation and convey confusing messages to the public," he added.
"Put it very simply, you cannot compare oranges with apples and pears," he said.
Looking at the real life situation in respect of the construction of private housing as at the end of May this year, Mr Suen said that the three years from 1999 to 2001, the number of commencement for the period was 79,700 flats and the total number of flats completed during the period 2002 to 2004 was 83,900.
"This lends support to our using a three year gap between commencement and completion of private housing developments as a proposition in making our projections.
"Our forecast for the next three years showed that about 26,000 flats will be completed this year, and around 21,000 next year. Thereafter, the figure will be about 16 000 units in 2006 and 11,000 in 2007.
Noting that some may wonder why the estimate for 2007 was now higher than the figure released in April, Mr Suen said that the reason was simple, there were new foundation works which had commenced between April and the end of May. This increase was now reflected in the updated figures.
"By the same token, as we move on in time, the figure for 2007 which we will post by the end of the year will be different to take account of the new work undertaken between now and the end of the year.
"In other words, for the last year of any three-year cycle commencing from a current year, our forecast will give the full year figure for that last year only at the end of the current year," Mr Suen said.
Mr Suen noted that the Government's assessment was based on the number of projects started based on the approval given for commencement of foundation works as well as the number of approvals given for project starts based on the commencement of superstructure works.
"The law as it stands requires developers to re-apply for the issue of Consent on Commencement of Building Works for every major revision of their projects. Because of this, the numbers concerned would involve double or even multiple counting when one or more major project revisions are necessitated.
"This leaves the number of approvals given for project starts based on the commencement of foundation works as a logical measure to deduce the supply of flats by the private sector.
"Using this as a yardstick, and allowing a normal lead time of about three years from commencement of foundation works to project completion, it gives us a fair basis to project future supply at any one point in time," he said.
"In practice, the flat supply for each year is also affected by a number of other factors. Among them are the timing of construction and the quantity of unsold housing stock accumulated from previous years, as well as commercial decisions by private developers about when to commence construction of the superstructures.
"It is also affected by how many new pre-sale or completed flats the developers want to offer for sale, which, in turn, is influenced by prevailing market circumstances," he added.
Turning to building management and maintenance, Mr Suen said the Government was now analysing views expressed following a public consultation exercise conducted earlier this year.
"Our goal for the coming months is to give thought to all the ideas raised during the consultation process; and to use them as the basis for establishing a clearer approach.
"One of our initial ideas is to invite non-governmental organisations to provide adequate support and assistance to
old and vulnerable owners who live in dilapidated buildings, if there are public resources available to permit this.
"Possible types of assistance we might give them include helping owners to form owners' corporations, assisting them in appointing contractors to undertake maintenance works, and giving owners technical support on building management and maintenance matters, in conjunction with relevant professionals.
"We will explore the feasibility of this approach with the non-Government organizations and the industry, and we will consider introducing a pilot scheme to test the outcome," he said.
Ends/Saturday, June 19, 2004
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