On October 16, Hong Kong’s Chief Executive John Lee presented his third policy address during his term. In a press conference that afternoon, he emphasized that this year’s report focuses on reform and finding new growth opportunities. Among various measures aimed at improving people’s livelihoods, the government plans to phase out substandard “divide flats” and establish minimum standards for what will be called “simple flats,” with the goal of ensuring better living conditions for all citizens.
Lee outlined three key principles guiding the formulation of this policy report: a citizen-centered approach, an economic focus, and an emphasis on improving living conditions. He stressed that reform is an ongoing process that requires constant self-reflection and innovation to diagnose underlying problems. Addressing the serious shortcomings of past policies, he emphasized the need for corrective measures – or “surgery” – to overcome bottlenecks and eliminate barriers.
Regarding the proposed legislation to ban substandard “divide flats,” which will be redefined as “simple flats,” Lee revealed that there are currently around 110,000 households living in these divided units. He noted that conditions vary significantly among different “divide flats,” and improving this situation won’t happen overnight. Efforts will be made to systematically enhance unit standards while addressing housing needs. While the majority of “divide flats” require significant improvement, Lee acknowledged that many residents appreciate their convenient transportation, safety, low costs, and acceptable living conditions, underscoring the need to balance diverse tenant requirements.
Lee stated that each policy address should evolve with the times. Given that Hong Kong is now in a phase of proactive development, his administration’s goal is to seek reform, pursue multiple avenues for progress, and unleash potential. He believes that once standards for “simple flats” are established, the market will gradually transform and develop in an orderly manner, ultimately phasing out substandard “divide flats.” The government plans to implement a sufficient registration period and grace period to allow current residents to register and make necessary modifications. He estimates that the cost of renovating each “divide flat” could range from several thousand to 100,000 Hong Kong dollars, with around 30% likely needing modifications to meet the new standards before they can continue to operate in the market for many years to come.
