HOUSING
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be required to pay a premium. The new owner will take over the premium liability from the seller, but will not be required to pay a premium unless and until he wishes to sell the flat in the open market 10 years or more after the first assignment by the HA to the initial purchaser.
The revised resale restrictions for HOS and PSPS flats will enable a more rational use of housing resources, help to increase the turnover of HOS and PSPS flats to meet demand for subsidised home ownership and free public rental flats for reallocation to people in genuine need.
Sandwich Class Housing Scheme
The Sandwich Class Housing Scheme was introduced in 1993 to help families with a monthly income of between $20,001 and $40,000 buy their own homes. In 1997, the lower and upper limits were revised to $30,001 and $60,000 respectively. It comprises a Loan Scheme and a Main Scheme, both of which are administered by the Housing Society.
The Loan Scheme, with a grant of $3.38 billion from the public funds, will help 7 500 families buy their own homes in the private sector. Successful applicants can borrow up to 25 per cent of the flat price or $550,000, whichever is the less, to buy a property no more than 20 years old and worth not more than $3.3 million. The loan is repaid in 120 equal instalments starting from the fourth year after the loan is made. Interest is charged at 2 per cent a year. By the end of 1997, 4 500 loans worth $2.1 billion had been granted.
The Main Scheme involves the construction of flats which will be sold to eligible applicants at discounted prices but subject to a five-year resale restriction. The land is granted to the Housing Society on concessionary terms and this is reflected in the selling prices of the units. In all other aspects the flats are comparable to those built by the private sector. The scheme is on target to produce 50 000 flats by 2005.
Currently, 1024 flats on Tsing Yi have been completed, and another 4 930 flats have been sold to eligible families. Suitable sites for this purpose will continue to be indentified.
Home Purchase Loan Scheme
The Home Purchase Loan Scheme was introduced in 1988 to help lower- and middle- income families buy flats in the private sector. In 1997, 3 647 families benefited from the scheme. About 52 per cent of these families were public housing tenants who surrendered their rental flats for reallocation.
Eligible applicants are offered an interest-free loan, repayable over the same period as the bank mortgage on the property, up to a maximum of 20 years. Alternatively, they may opt for a monthly subsidy for 48 months, which need not be repaid.
The loan and monthly subsidy given to public rental tenants were $600,000 and $5,100 respectively, while those for private sector applicants were $400,000 and $3,400 respectively. So far, 20 048 loans and 1 282 subsidies have been granted. As a result, 11 914 public rental flats have been recovered.
Home Starter Loan Scheme
The government announced in October that a new scheme would be launched to help low and middle income families purchase their own homes. Eligible applicants of the