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LAND AND HOUSING
To ensure that scarce land is put to the best possible use, all sales or grants are subject to a covenant in which the lessee undertakes to develop up to a certain rateable value within a specified period. The amount he must spend depends on the location and the type of development allowed. In addition to the covenant new leases contain clauses controlling the use to which land may be put, to accord with town planning. They also provide for the annual payment of Crown rent.
Certain relaxations of time limits on building development were announced in November 1965. These applied to developers owning land which was either the subject of an exclusion order made before 1st July or held from the government under conditions of sale or grant executed before 1st July, and on which development had not begun or had not been completed. These developers became eligible to apply for an extension of one year-free of either penalty or premium—of the time limit by which they were bound to begin or complete their approved development scheme, or to fulfil their building covenant. In deciding to make this concession the govern- ment took particular account of the very large number of exclusion orders made during 1963 and 1964. Many of these schemes, which might otherwise have been spread over a longer period, were obviously undertaken at that time to avoid new restrictions under the Building (Planning) Regulations which were announced in advance in 1962. It was also felt that the concession was appropriate at a time when, in certain categories of domestic and other premises, supply temporarily exceeded demand.
Sale by public auction ensures, by and large, that the person best able to develop the land in accordance with the terms of the lease obtains the right to do so and that the community receives the maximum return in cash. As the rent reserved in the lease is low, this policy does not, generally speaking, enable the government to obtain direct financial gain from any increase in the value of the land after it has been sold. For this reason the very large increase in land values in recent years has resulted in relatively little increase in recurrent revenue from land, since most of the Colony's more valuable land is held on long leases.
In the earlier part of this century the leases of lots lying in the better residential districts of Hong Kong Island and Kowloon often included restrictions on the type and height of buildings. These