One reason the U.S. government has been pushing for home ownership is because it’s said to reduce turnover and build strong communities. But, as I learned on a recent trip to Hong Kong, there may be other ways to get there.

Some background might be helpful here: In many Asian countries, commercial building landlords don’t finance tenant improvement allowances (the cost of paying for an office or retail tenant to customize their space), the way most do here. Leases are relatively short (often three years, vs our customary five to 10) but tenants tend to stay if the rents are reasonable, after all, they have invested in (and effectively own) an immoveable piece of the asset.

In Hong Kong, as I learned, subsidized housing works in much the same way. Thirty percent of the population lives in government subsidized housing–”Housing Estates”– as they are called. These units are rented out as bare shells. The apartments are essentially concrete boxes with only a skim coat of plaster (and plumbing conduit running on the outside of the building). As a result, the units are less prone to damage and can be more easily cleaned up when tenants change.  

(image: Hong Kong’s Ching Ho Tower, photo: Mark Huppert.) Read more…