HOUSING
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sold to prospective public housing tenants who were, in return, required to forego their rights to rental accommodation.
To encourage public housing tenants to become home owners and therefore give up their rental accommodation for those families who are in greater need of public housing, public housing tenants are accorded higher priority than private sector applicants in selecting HOS flats. This incentive is also extended to prospective public housing tenants, so that rental flats which would have been allocated to them can be let to applicants in greater need.
The Housing Authority also ensures the provision of adequate mortgage funding from financial institutions for the purchase of HOS and PSPS flats. In return for the authority's indemnity for an institution's loss in case of default, purchasers are able to enjoy favourable mortgage terms provided by over 50 financial institutions. Public sector priority status purchasers are able to borrow up to 95 per cent of the purchase price and private sector purchasers may borrow up to 90 per cent of the purchase price, with repayment periods of up to 20 years.
Implementation of the Long Term Housing Strategy has required an increase in production of HOS/PSPS flats from the previous level of 10 000 flats a year to around 15 000 flats a year for the period 1988 to 1990. Of these, about 25 per cent of the annual production will be upgraded flats in blocks originally intended for rental housing estates, thus providing a wider choice of flat sizes, standards, locations and prices for applicants.
During 1988, a total of 15 437 flats were offered for sale, starting with Phase 10A in April, when applications were invited for 5 048 flats in two HOS estates and two PSPS estates. This included 816 flats in Stage I of Po Nga Court, Tai Po, a rental block transferred to HOS from the rental housing programme.
In August, a further 5 110 flats were put up for sale, attracting 83 700 applications, because of the very good locations of the two PSPS estates included in the sale. These were Tsui Chuk Garden on the fringe of urban Kowloon and Grandway Garden in Sha Tin.
Finally, in December, applications were invited for 5 279 flats in one PSPS and three HOS estates. This included a further 2 849 flats in upgraded rental blocks.
Flat prices and sizes varied widely throughout the year, with prices ranging from $202,400 for a 48-square-metre flat at San Wai Court, Tuen Mun to $536,700 for a large flat of 61 square metres at Tsui Chuk Garden, Chuk Yuen.
Home Purchase Loan Scheme
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The Home Purchase Loan Scheme, which is administered by the Housing Authority, forms an integral part of the government's Long Term Housing Strategy. The purpose of the scheme is to promote home purchase by assisting lower-middle income families to purchase flats of their own in the private sector. Families who meet the criteria for public sector priority status to purchase HOS/PSPS flats are offered the alternative of interest-free loans, repayable over up to 20 years, to help overcome the problems of initial financing faced by many families wishing to buy their own homes.
For 1988-9 a quota of 2 500 loans of $70,000 was established. 32 financial institutions participated by linking their mortgage loans to the authority's loans under the scheme. Applications from eligible households were invited during June and July, and 2 500 applications were received which, coincidentally, exactly matched the quota for the year. Applications received subsequently were put on a waiting list to replace any applicants who withdrew from the scheme.