Housing Is Cornerstone for New Hong Kong Regime

For 10 years, Steven Kung’s home has been a bed in a tiny room with 16 other bunkmates, his possessions carefully packed in plastic bags and tied to the metal bed frame.

On a lone wire hanger in his quarters is a monogrammed, tailored shirt that Kung once wore as a civil servant--in Hong Kong’s Housing Department. But even that life’s labor didn’t keep him from ending up just one step away from homeless himself.

“I have no pension, no children to take care of me,” said the slight 69-year-old, explaining in impeccable Queen’s English that, as a contract worker, he didn’t receive retirement benefits.

“But maybe,” he said with a defiant twinkle, “I’ll meet a wealthy lady.”

In compact, fast-growing Hong Kong, where developed land is scarce, owning property can make the difference between ending up in a bed space like Kung’s or a mansion.

Real estate prices are five times the levels of a decade ago, making millionaires out of many but leaving the majority of Hong Kong people unable to afford their own apartment--52% of them are living in government-subsidized apartment towers.

Today, the housing shortage is one of the most volatile issues facing Hong Kong and a serious challenge for its incoming government.

But the issue also potentially offers a perfect foil for Tung Chee-hwa, the former shipping tycoon selected to run Hong Kong after the territory reverts to Chinese rule on July 1. He wants to show citizens here that life will improve after the hand-over of the colony from Britain to China.

Tung said he was shocked when he visited public housing for the first time last summer. He has vowed to make affordable housing the cornerstone of the first Hong Kong government under Communist China’s stewardship.

His move is partly meant to deflect attention from fears over plans to limit Hong Kong political freedoms and refocus it on bread-and-butter issues. Even more than political liberties, Tung said, “Hong Kong people’s real concern is about housing.”

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Last month, the outgoing administration announced that it has stockpiled a stunning $42 billion in reserves--and people are hoping that Tung’s team plans to share more of the wealth.

“Everyone should--in a society as rich as Hong Kong--have the chance to live in dignity,” said Daniel Leung Ho-wah, a social worker at one of Hong Kong’s public housing projects.

Indeed, Tung has tapped into a deep vein of resentment: Many here feel cheated of a basic right by a colonial government that was actively colluding with rich developers at the expense of citizens’ needs.

This year the government earned 32% of its budget from land sales but is only spending 11% on providing better homes.

When Chris Patten, the last British governor of Hong Kong, visited a temporary housing area two years ago, he was greeted by residents who threw a live rat at him.

“We only wanted to show him the reality of our living conditions,” said Kong Leung, 50, a carpenter behind the protest. “I think we got his attention.”

Now, as Tung’s inner circle prepares a new policy, people are sending them messages, as well. After Housing Secretary Dominic Wong dismissed wild speculation that pushed real estate prices up 50% in six months as “an isolated problem” and announced that the government would gradually double public rents, he was the target of death threats, a fake bomb with his and Tung’s names on it and a letter to the newspaper suggesting he poison himself.

Wong, who will stay in his position under the new government, is taking notice.

“I’m doing as much as I can to improve the situation in Hong Kong,” he said with a civil servant’s precision. “We need to plan ahead and move faster. Land can’t be created overnight.”

But demand for housing can burgeon even more, analysts say. Despite promises of 41,500 new public units next year, the housing supply is shrinking as the number of needy, new immigrants from China increases.

Beijing has sharply criticized Hong Kong’s rising payments to a rapidly aging population, comparing the territory’s expanding welfare commitments to an out-of-control race car headed for a crash.

But housing spending has so far escaped criticism, policymakers say.

“Housing is much more than a roof,” said Leung, the social worker. “Owning a home creates social stability and a feeling of community.”

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A scan of the horizon in Hong Kong’s Kowloon Bay shows the steep, vertical divides between the rich and poor. At eye-level, there are rat-ridden yellow barracks. They were thrown up 40 years ago as temporary housing for 50,000 people left homeless by a squatter campfire. But they are still occupied by families waiting for a spot in a project like the Kai Yip Housing Estate just across the street.

Meanwhile, residents in Kai Yip’s cluster of identical 20-story buildings, who pay about $200 a month for 400-square-foot units, aspire to someday own an apartment next door in the towering blocks that loom like a fortress over the neighborhood.

Far above this thicket of buildings is Victoria Peak--the pinnacle of private homes. It is out of sight--in altitude and in its sky-high real estate prices. Earlier this year, a mansion there sold for $70 million.

Caught between the peak and public housing is Hong Kong’s “sandwich class,” who use an average of 60% of their family income for mortgage payments.

“There’s help for the poorest, and the rich are fine. But there’s something wrong when even a college graduate can’t afford his own home,” warned Nelson Chow, professor of social policy at Hong Kong University. “People are becoming extremely frustrated.”

For Tung, he has a simple suggestion: “Supply more land, build more houses. It’s nothing so complicated.”

What has proven to be difficult is allocating the money, placating private developers and finding the land, said Wong, the housing secretary.

Tung has appointed a task force to study housing. But his naming of C.Y. Leung, a prominent real estate surveyor, as its leader has disappointed people like Chow, who fear that such individuals have a conflict of interest.

“He knows the private sector very well, but he may not be the perfect person to understand Hong Kong people’s needs,” Chow said of Leung.

Tung understands that he must move quickly to remedy problems left by the colonial government.

However, Patten also had bold designs when he took office in July 1992. He vowed to clear temporary housing areas by 1997--this year.

But residents who have lived for years in the tin-roofed shacks without toilets are still there--and though some have received offers to be resettled in “interim housing,” they say their quarters of temporary privation are feeling more and more permanent.

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At Kai Lok Temporary Housing Area, Sung Wan-pang, 32, can touch both walls of her home if she stretches her arms. She, her husband and two children live in a single room with one bed. At night, a board across two stools becomes a mattress for her daughter, 4; the 3-month-old baby sleeps with Sung; her husband works the graveyard shift at a restaurant and sleeps by day.

The Sungs and their neighbors debate the size of the area’s rats.

“Oh, they weigh at least five pounds,” she said. “I’m afraid to turn my back on the baby.”

Though the Sungs pay only about $20 a month for their space, the crowded, dirty conditions carry additional costs. A pastel pamphlet on mental health shares the table with crayons, sleeping pills and an Elvis tape. On the other side of the plywood wall is a former psychiatric patient who hacks at the wood at night with a butcher knife.

“I don’t want to end up crazy,” Sung said, tears beginning to pool as she flips through an album with pictures of herself as a pig-tailed girl in China, an army nurse, then a bride. “Some days I think I will.”