In his annual policy address, Hong Kong's leader unveiled plans to tackle the housing crisis.

• The government introduced a policy to simplify the process of obtaining subsidized housing for young Hong Kongers, addressing concerns about their struggle to enter the housing market.
• The government will continue to increase its public housing supply and tackle issues with Hong Kong's cramped subdivided flats, as stated by Lee.

In his annual policy address on Wednesday, Hong Kong chief executive John Lee revealed plans to tackle the city's housing affordability crisis, which he described as a major public concern.

In his speech, one key policy was announced to simplify the process of obtaining subsidized housing for young citizens under 40, as there is growing concern about their difficulty in finding affordable housing in the city.

The Hong Kong Housing Authority will increase the chances of applicants aged below 40 being selected for the city's subsidized Home Ownership Scheme flats by allocating an extra ballot number to them.

In 2023, only 4,500 households were eligible for flats under the "White Form Secondary Market Scheme," which allows secondhand subsidized flats to be bought and sold without a land premium. However, the government has decided to increase its quota for the scheme by 1,500 units, all of which are reserved for applicants under 40.

Amid reports and fears, young Hong Kongers in the city may choose to decline promotions and pay raises to maintain eligibility for public housing rather than enter the private market.

The government will continue its Youth Hostel Scheme, which subsidizes non-governmental organizations' renting of hotels and guesthouses for use as youth hostels to address youth housing affordability.

For over a decade, the 2024 Demographia International Housing Affordability report ranked the city as the least affordable place to find a home due to its over 100,000 "shoe-box sized" subdivided flats, which have been linked to health and safety issues.

On Wednesday, Lee announced that the city would introduce a new rental system for subdivided flats, with substandard units being transformed into "Basic Housing Units" that adhere to new standards, including windows, toilets, and a minimum size of 86 square feet.

The government aims to complete approximately 30,000 new public housing units by 2027-2028, with plans to complete about 9,500 units next year.

The wait time for a public housing unit in Hong Kong could be reduced to 4.5 years by 2026-2027, according to Lee.

On Wednesday, Lee delivered his third policy address in five years, with a greater emphasis on enhancing residents' quality of life and boosting the city's economic growth compared to previous addresses.

The previous mayors had primarily focused on national security and post-pandemic recovery, with Lee assuming office after a period of civil unrest that coincided with the onset of the Covid-19 pandemic.