Hong Kong chief executive Donald Tsang Yam-kuen has suggested that the rent-to-buy scheme, supposedly a temporary relief measure for better-off home buyers, could be expanded if it receives good response.
Mr. Tsang also challenged his critics and supporters of the old home ownership scheme (HOS) to ask buyers which scheme they would prefer.
Calls to revive HOS, a Housing Authority programme intended to help middle-class families own homes, mounted amid increasing flat prices in recent years. The programme was terminated in 2002 in an attempt to support the private real estate market.
Opposing the HOS, Mr. Tsang said at the Legislative Council that the Housing Authority should concentrate on offering public rental units to those who are in need, rather than building units to sell.
“Our [rent-to-buy] scheme is an improved version of HOS,” said Tsang, who took several questions from 18 lawmakers during the 100-minute session last Thursday. Four legislators wanted HOS back or questioned the rent-to-buy scheme’s effectiveness.
Tsang, however, disagreed that the new system was better compared to the HOS and the best option should be implemented to help people.
He also asked his critics not to hold conspiracy theories. “We can also ask the end users which scheme they think is better,” he said. “Depending on the market, we may consider increasing the supply [of rent-to-buy scheme flats]. But the market can change. When land supply increases, the market may be more stable. Whether the scheme is still needed, the government will discuss it then.”
Under the programme, previously called the My Home Purchase Plan, the government will allow middle-income families to rent Housing Society units for up to five years at a certain amount. During that period, tenants can opt to use 50 percent of the total rent paid towards a down payment in home purchases.
The first development under the programme will provide approximately 1,000 units on Tsing Yi and is likely to be completed by 2014. Four other sites in Sha Tin, Diamond Hill, Tuen Mun and Tai Po have also been identified for the development of 4,000 flats.