Hong Kong To Build Artificial Island To Solve Housing Shortage

In order to tackle housing crisis in, Hong Kong is planning to build one of the world’s largest artificial island at an estimated cost of $79 billion that would be nearly three times the size of New York’s Central Park. The Hong Kong government is planning to reclaim 1,000 hectares of land around Lantau, which is also the largest island in the territory, to solve the pressing housing shortage in the city. By comparison, Dubai’s Palm Jumeirah Island, also created by land reclamation, measures around 560 hectares.

Bloomberg has earlier reported that it takes an estimated 19 years of median household income to buy a home in the city. Despite increasing the government taxes on real estate purchase, demand for the Hong Kong property market is not cooling down.

In 2012, Hong Kong imposed a 30 per cent stamp duty on purchases by foreign nationals which is also a qualifying threshold for permanent residency in the city. In fact, the top 12 property developers in Hong Kong made more money by developing real estate than billionaires elsewhere in the world and together they control $119 billion in net worth.

The work on reclaiming land will begin in 2025 while the residents will be allowed to move to the island in 2032. This man-made island would house more than 2.6 lakh housing units, out of which 70 per cent will be used for public housing. Lantau Island is well connected to neighbouring Macau and mainland China through the world’s longest sea-bridge, launched last year.

Even though the property prices in the city fell around 10 per cent since August due to US-China trade war and falling currency, experts are expecting a major turnaround due to improving economic condition, according to media reports. There has been a stark improvement in Hong Kong developer shares as they have risen in recent months even as property prices declined.