El Código de Procedimientos Penales de

House Buying suffered the most damage from the government policy in the housing market for its cessation of the HOS as we shall discuss soon in this section. Yet this “free market” approach to the social policy is not an isolated case. Social policy to offset the social problems that are caused by polarization has been short-term, piecemeal and “neoliberal” in general. For instance, in 2008 after the Financial Tsunami, the government appointed a temporary task force (Task Force on Economic Challenges) to revise its policy. The economic measures they implemented were designed to have relatively long-term results, while the social policies are supposed to be aimed at relieving the immediate hardship. The former measures are mostly about sustaining long-term economic growth, including

strategies to strengthen “the six economic areas where Hong Kong has enjoyed clear advantages, namely testing and certification, medical services, innovation and technology,

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cultural and creative industries, environmental industry, and educational services”.308

However, the measures in social policy are mostly short-term. These included providing temporary jobs and internship that lasted from six months to three years, a one-off grant of HK$1,000 for students who are from the families which are already receiving social security assistance, and paying the basic rent for two-months for public housing tenants.309

The government began to implement plans to privatize public services, especially in the realm of housing and property management. The commercial assets in public housing estates, like shopping malls and car parks, were grouped together under a private company – The Link.310 _{The rationale for the creation of this company was to boost the property market}

and aid economic recovery.311 _{However, the social consequences of the formation of this}

company were significant. Under its management, smaller local shops were gradually driven away because they were unable to pay the higher rent that chain stores could afford. The shopping experience became homogeneous and limited to more expensive choices. As a result, the everyday grocery expenditures for public housing tenants was higher.312

The most significant impact on the hope mechanism of House Buying was the result of the government's decision to stop intervening into the housing market in the early 2000s. During the economic recession from 1998 to 2003, the HKSAR government adopted the neo-

308 _{Legislative Council, HKSAR. (2009). “Press Release - LCQ7: The six economic areas proposed by the} Task Force on Economic Challenges for further development”.

309 _{Lee, K. M. and Law, K. Y. (2014). “Economic Insecurity and Social Protection for Labour: The} Limitations of Hong Kong’s Adhocism during the Financial Crises”.

310 _{Link Asset Management Limited is established in 2004 and manages a real estate investment trust that} consists of about 9 million sq. ft. of retail space and approximately 61,000 car park spaces. These assets are mostly in the public housing estates that were previously operated by the Hong Kong Housing Authority. 311 _{Chen, Y. C. and Pun, N. (2007). “Neoliberalization and Privatization in Hong Kong after the 1997} Financial Crisis”. P. 77.

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liberal ideology that “economic growth is the best way to enhance social welfare”.313 _Hence,

the government chose economic and social policies that maintained low taxes and low public spending to restore economic growth during the recession.

In this context, the government's housing policy took a drastic turn. At the beginning, in 1997, Tung Chee-hwa, the first Chief Executive, proposed to ease the property bubbles in the 1990s by introducing a large-scale housing project to build 85,000 housing units annually in the first year of the HKSAR era. But after the Asian financial crisis, the economic downfall disrupted Tung and his administration's original plan. The subsequent economic recession, the plummeting of housing prices and the pressure from the propertied class and property developers in the political system of “corporatist state”314 forced Tung to not only withdraw his interventionist plan, but also to totally retreat from the housing market. Through this drastic policy turn, the HKSAR government sent a strong “political signal” to the market that the HKSAR government was going to “guard the property market from further decline”.315

In 2002 the government announced its total retreat from being an active participant in the housing market, and suspend the subsidized Home Ownership Scheme (HOS), in which the government builds and sells apartments with a 30% to 40% discount lower than the market prices. “A Statement on Housing Policy” made the government's repositioning of its role clear: “Government should withdraw from its role as property developer”,316 _and

“withdraw as far as possible from other housing assistance programmes to minimize

313 _{Lee, E. W. Y. (2005). “The Renegotiation of the Social Pact in Hong Kong: Economic Globalisation,} Socioeconomic Change, and Local Politics”.

314 _{Ma, N. (2016). “The Making of a Corporatist State in Hong Kong: The Road to Sectoral Intervention”.} We’ll discuss this concept in the next section.

315 _{Yip, N. M. (2013). “Challenges to Public Housing in Post-colonial Hong Kong”. P. 69.}

316 _{Legislative Council, HKSAR. (2003). “A Statement on Housing Policy by Hon. Michael M Y SUEN,} GBS, JP Secretary for Housing, Planning and Lands”. P. 3.

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intervention in the market”.317 _{In the conclusion, the HKSAR government reiterated again:}

“home ownership should be a matter for the market with which Government should refrain from competing.”318 _{From 2004 to 2007, the HKSAR halted the subsidized homeownership}

scheme and stopped building any subsidized housing units.319 _{Meanwhile, the supply of}

public rental housing hit a record low.320 _{Scholars had suspected the reasons behind this to be}

“the pressure of property and financial interests”321 _{and “the pressure exerted by developers}

on the government”.322

As the HOS vanished, this also caused the shrinking of the first step in public rental housing. While the HOS had been popular in the 1980s and 1990s, the applicants were selected through a lottery. The public housing tenants had to return their public housing units to the government in exchange for a higher chance in the lottery. Without the incentive that can encourage the existing tenants to return their public housing units, the queuing time for the new comers in public rental housing is further prolonged.

The government's retreat from the housing market accompanied the changing

conception of “being self-reliant” promoted by the HKSAR government since the mid-1990s. At the beginning of the colonial government’s promotion of private house buying in the 1980s, being self-reliant only meant not using the social welfare provided by the government in the official discourse of the colonial state. The objective of the colonial government's subsidized homeownership program was to add an incentive for the population to return the

317 _{Ibid. P. 6.}

318 _{Ibid. P. 15.}

319 _{The government gradually restores the HOS since 2011.}

320 _{Hong Kong Housing Authority. (2015). Housing in Figures 2015.}

321 _{Lee, K. M. and Cheng, C. Y. (2011). “Financialization, Economic Crises and Social Protection: the Case} of Hong Kong”. P. 33.

322 _{Chen, H. et al. (2018). “Socio Spatial Polarization and the (Re-)distribution of Deprived Groups in World} Cities: A Case Study of Hong Kong”. P. 7.

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public housing units they occupied to the government by entering the private housing market. Thus, the HOS aimed at setting up the subsidized housing as the next step on the housing ladder for those capable, to finally move into the private housing market. It helped “fulfilling a double purpose of providing new homes for those who can afford to buy them and of simultaneously making rented accommodation available for those who cannot”.323

The wealthy tenants in public housing were seen by the government to be those who misused the public resources. Adding to the incentive of HOS that encourages these tenants to return their units, the colonial state forced the rich tenants out to rely on themselves in the housing market through charging extra rents. The government implemented “the Housing Subsidy Policy and Policy on Safeguarding Rational Allocation of Public Housing

Resources” (the more common name is the “Well-off Tenants Policies”) in 1986 and further modified in 1993. The policy required the tenants who lived more than 10 years in the public rental housing to declare their income and wealth biennially. Those who exceeds the limit were required to pay extra rents (1.5 to 2 times of the normal rent). The colonial government stated that “it is plainly wrong that public housing should continue to accommodate tenants who have the financial resources to meet their own housing requirements at the expense of those with a genuine case for rehousing”.324 _{After all, the government policy treated public}

housing as social welfare for the needy, instead of a social right of the whole population. Since the mid-1990s, “self-reliant subject” gained another layer of financial meaning in the official discourse. Throughout the 1970s and 1980s, homeownership was often

addressed by the colonial state in the context of soaring housing prices, and characterized as the cause of unhappiness of the population that affected its legitimacy.325 _Subsidized

323 _{Policy Address. (1980).}

324 _{Policy Address. (1995) “The 1995 Policy Address – Hong Kong: Our Work Together”.} 325 _{Policy Address. (1981).}

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homeownership was the response to increase the housing supply and to satisfy the

population's desire for homeownership. In 1996, homeownership was addressed for the first time not only as a legitimacy problem and social need of owner-occupancy. Homeownership was put on the table in the official discourse as a desirable investment object and carried the meaning that one can make use of his/her own apartment as the financial tool to solve one's individual problems. The HOS in its official statement outlined multiple reasons for

promoting homeownership. It stated that in addition to the sense of belonging to the

community, homeownership can also enhance “personal financial planning and security” – “in Hong Kong, ownership of property has also proven to be a popular and valuable investment”.326 _{It was an investment vehicle of a family's finance. Despite the 1997}

handover, this financialization turn of homeownership remained unaffected even during the Asian financial crisis in 1998.

Property is one of the most important components of the economy. A good home is also an important factor in maintaining the quality of life, and the residential property market in particular serves as both a major vehicle for the personal investment of wealth and a public barometer of social stability.327

This way of talking about homeownership continued in 1999 and 2000. “For most people in Hong Kong, a home is more than a place to live. It represents the most important investment in their lives”,328 _{and “people buy property not only as a home, but also as an}

important long-term investment”.329 _{The homebuyers are also the self-reliant investors in the}

official discourse. The government's action was not to help them directly, but to retreat from intervening into the “free” housing market. Under such neoliberal ideology, maintaining a

326 _{Hong Kong Housing Authority. (1996). Report on the Review of Home Ownership Schemes. P. 4.} 327 _{Policy Address. (1998). “From Adversity to Opportunity: Address by the Chief Executive the Honourable} Tung Chee Hwa at the Legislative Council meeting”.

328 _{Policy Address. (1999). “Quality People, Quality Home – Positioning Hong Kong for 21st Century:} Address by the Chief Executive the Honourable Tung Chee Hwa at the Legislative Council meeting”. 329 _{Policy Address. (2000). “Serving the Community, Sharing Common Goals: Address by the Chief} Executive the Honourable Tung Chee Hwa at the Legislative Council meeting”.

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“free” market was seen as a decision that benefits these homebuyer-investors. As we shall see in the focus group discussions in Chapter 5, such financialized imagination of

homeownership has become commonplace among the young adults when they understand homeownership as the safety net, not only as a shelter, but also as a financial tool.