Information Note for
Provisional Legislative Council
Panel on Housing

Sale of Public Rental Housing Flats to Existing Tenants Scheme


This paper notes the present position on the Government's commitment to sell public rental housing flats to existing tenants.


2.The sale of public rental housing flats to existing tenants is a key element in our housing strategy to promote home ownership in the community. By giving families in public housing an opportunity to buy their own homes, the scheme will help -

  1. to satisfy the growing demand for home ownership; and

  2. to allow tenants to become stakeholder in the community.

3.We have reviewed our earlier proposals in the light of suggestions and comments received during the Long Term Housing Strategy Review public consultation exercise. There has been widespread support in the community for a new scheme to sell rental flats to public housing tenants at an affordable price.

Present position

4.We will ensure that the price of flats sold under such a scheme is set at a level which is both attractive to the prospective buyer and fair to the general community. We will set the price at a level or levels based on the replacement cost of the flats1 , with adjustments to reflect location, age and other relevant factors.

5.The operational details of the scheme are now being developed by Housing Authority. These include -

  1. flexible mortgage arrangements;

  2. the condition of flats will be checked and essential renovation works carried out before sale;

  3. a structural guarantee period will be provided;

  4. Owners' Incorporations will be set up;

  5. maintenance funds will be established; and

  6. reasonable resale conditions will be drawn up.

Way forward

6.Over the next ten years, we will provide the opportunity for at least 250 000 families living in public rental housing to buy their flats at a reasonable and affordable price.

7.We expect to receive from the Housing Authority details of the scheme in time for the Government to finalise an implementation plan by the end of this year, so that the first batch of about 25 000 flats can be sold early in 1998.

1.Replacement cost is building construction cost plus overheads and development cost. As an example, a typical flat (size 40 sq.m.) (saleable floor area) has a replacement cost of about $0.4 million.