Supply & demand: The supply of flats will fall in the next three years as the number of units being built has continued to drop since 1998.

The supply of flats will fall in the next three years as the number of units being built has continued to drop since 1998.

Secretary for Housing, Planning & Lands Michael Suen said there were only 8,100 units under construction in the first six months of this year. As it takes about three years to complete a flat, he said it is natural that the number of flats to be completed in the next few years will fall.

The vacancy rate of flats now stands at a record high of 6.8%, with about 74,000 flats vacant, 20,000 more than normal levels.

Commenting on the Kowloon Canton Railway Corporation's proposal to return to the Government the development rights of flats along its lines, Mr Suen said the Government will consider the proposal.

He said the KCRC and the Mass Transit Railway have the right to develop more than 60,000 flats along their lines, adding that these units will not be constructed in the next few years.

He reiterated that the Housing Authority has no plan to build flats under the Home Ownership Scheme.

Mr Suen said the main problem facing the property market is the lack of confidence of buyers. He said the Government is now considering measures to boost the market and will release them in two or three months.

He said we are now at the end of the tunnel and he is cautiously optimistic on the future of the property market.