The rise of Hong Kong’s “coffin homes”
Such a densely populated city as Hong Kong naturally comes with its own set of problems. With the population growing at a huge rate, Hong Kong has long been stretched for space, finding it difficult to keep up with the impossible gulf between supply and demand. In an attempt to curve the issue, so prevalent in a city in which only 7% of available land is zoned for housing, Hong Kong made the rather brave decision to build up instead of out. As a result, the majority of Hong Kong is made up of high-rise buildings, squeezing the maximum amount of people into the smallest of spaces.
Although common practice in mature markets like the UK to create Houses of Multiple Occupation (HMOs) in which large spaces are split into a series of smaller living spaces to incorporate more tenants, Hong Kong has warped this trend beyond all recognition. Dubbed “coffin homes” by the press, Hong Kong is the birthplace of 20-square-foot ‘homes’ in which Hong Kong residents are forced to reside, either out of necessity or because of the rising unaffordability in the homeownership market. Shockingly, an apartment of this size (currently renting at a market value of $226 per month) is some 3.75 times smaller than the average prison cell in Hong Kong, which at 75 square meters, seems positively palatial in comparison. Naturally there are no legal guidelines dictating apartment sizes, nor rent control measures in place, leading to the likes of “coffin homes” running rampant in a market whose housing supply doesn’t come close to satiating demand.
Hong Kong is currently one of the most expensive destinations in which to own your own home, with the average price per square foot hovering around HK$10,700 (which, at $1,380 US dollars, is just $265 less than America’s most expensive city, New York). House prices in Hong Kong have grown a massive 50% since 2012, creating a housing bubble the likes of which many have never seen. Therefore, it may come as no surprise that Demographia recently named Hong Kong the most unaffordable major housing market in the world. Furthermore, the rents in Hong Kong have followed the upwards trajectory of its house prices, with median rents surging 10.5% to HK$4,200 ($540) as of 2015, and still rising even now. Such is the problem that the city’s unaffordable housing poses, chief executive Leung Chun-yin had condemned Hong Kong’s housing crisis as “the gravest potential hazard to the community, as many families have no choice but to live in subdivided units”.
This brazen acknowledgement of the problems facing Hong Kong’s housing market shows that the Government, far from feigning ignorance about this phenomenon currently gripping the nation, is very much acutely aware of their problems. Official estimates predict that over 200,000 Hong Kong residents are forced to live in “coffin homes”, and so the Government are currently launching head-first into plans to build more available homes—plans that, if seen seen through to fruition, could provide the city with somewhere in the region of 280,000 public and 180,000 private homes by 2027. Whilst an honourable attempt to reverse the negative trend by a Government steadfast in its attempts to mitigate the bubbling housing crisis, this calls into question: what happens in the meantime? Are people expected to continue to live in what the United Nations call “an insult to human dignity”—and pay rents nowhere near proportionate for the privilege?
