What Sydney can learn from Hong Kong about affordable housing

Hong Kong may be the location of some of the world’s least affordable housing, but leading academics believe there may be lessons Sydney can learn from the global city.

Despite households spending 19 times their annual household income to afford a median-priced home in Hong Kong, worse than Sydney’s 12 times, the Chinese city is performing strongly when it comes to supplying affordable housing.

A lecture hosted by the University of Sydney’s Henry Halloran Trust on Tuesday night compared London, Hong Kong and Sydney in terms of planning and housing supply.

Rebecca L.H. Chiu, director of the centre of urban studies and urban planning at the University of Hong Kong, said despite being gripped by an affordability crisis, Hong Kong is in fact a “dualistic” market, with a strong segment of cheaper housing supply fuelled by the government.

“After the global financial crisis [property prices] went up – but what has actually rocketed up is the high-end sector,” Dr Chiu said.

This was largely due to international development and a growing upper middle class of millionaires in China, she said.

In Hong Kong, the government owns all the land and sells lower-priced homes to the public as “subsidised” housing by releasing new property as demand requires it. With the profits made on these blocks, the government reinvests in public housing on a huge scale.

In total, 44.3 per cent of Hong Kong’s population rent, with about 30 per cent of the population in public rental housing. The government supply plans aim to add primarily to the affordable housing stock.

Their public rental sector is not “located in the fringe of the city, it’s located everywhere” and the developments have started to become more design-focused with green spaces and shared amenities in the often 40-storey-high developments, Dr Chiu said.

The result? Low-income earners can live side-by-side with high-income earners in the city, close to employment opportunities.

“The question we need to ask ourselves is: How can we move to producing more houses for the many, rather than producing lots of houses that are available only to the very few?”

Sydney has not had such a widespread approach to affordable housing.

Nicole Gurran, director of the University of Sydney’s Urban Housing Lab@Sydney, said the debates around supplying affordable homes in Sydney were often similar to those in cities such as Hong Kong and London.

While looking at foreign policies “unfortunately” can’t tell us what to do in Sydney, she pointed to the “consistent” approach of providing affordable housing in Hong Kong that underpinned most development.

“What we [in Sydney] haven’t been able to deliver on our exemplary sites, or our non-exemplary sites, is an affordable outcome at all,” Dr Gurran said.

Sydney’s lord mayor Clover Moore said last year “urgent action” was needed on affordable housing with less than 1 per cent of homes in the City of Sydney classified as affordable.

The City of Sydney’s housing strategy aims to provide 8000 affordable rental homes by 2030. In Green Square, the target is for 330 affordable rental units and targets in Ultimo and Pyrmont of 450 homes have been reached.

Cr Moore pointed to some London boroughs’ ability to impose affordable development levies on new developers of up to 50 per cent, while in the City of Sydney they could impose “just 2 per cent in certain areas”.

Despite the significant affordability levies, Nick Gallent, head of the Bartlett School of Planning at University College London, warned that England had been “very bad at building housing” with some major housing sites having a decades-long history of “development inertia”.

England develops 100,000 new dwellings a year compared to a projected need for 230,000.

“We have a housing crisis in England at the moment,” he said, pointing to a much-cited supply crisis as well as a less-discussed demand crisis.

“There’s an expectation in the UK that housing is a commodity that drives the economy,” he said, pointing to the under-taxing of property.

Dr Gurran said Sydney needed “to look at where housing isn’t a commodity and where it is shelter”.