The future cash compensation for Hong Kong homeowners affected by redevelopments should take into account the physical condition of buildings to encourage maintenance efforts, observers have said, as the renewal authority reviews its policy to address financial challenges.
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Their comments were made on Wednesday after the Urban Renewal Authority (URA) recorded a deficit for three consecutive years. The cash-strapped body is expected to complete a review of its acquisition regime next year, with some of the proposed directions including considering homeowners’ maintenance efforts when calculating the compensation and offering better rehousing options.
Ryan Ip Man-ki, vice-president of think tank Our Hong Kong Foundation, said the authority needed a review due to its structural financial problems, but it should remain aware of its status as a statutory body and its objective of improving living conditions.
“As the authority is entitled to acquire properties, their compensation should be higher than the acquisition price offered by the private sector,” he told a radio show.
“The mechanism should also be linked with the flat conditions, as owners currently receive the same acquisition cost and have no incentive to improve their flats.”
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Under the current regime, owner-occupiers are provided with payouts equivalent to the market price of a comparable seven-year-old home in the same district.