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7.2 SHS and a Rewarding Childhood

Additionally, the Report reiterates that the SHS can be a highly ef-
fective solution to the problem of divorce. The implementation of the SHS
will allow public housing tenants to possess the same rights to that of a
private homeowner. Bona fide homeownership in future public housing
units would incentivise families to stay together and discourage family
breakdown. This can therefore act as a barrier against the costs of a broken
family among the children of the divorcees and prevent the build-up of bad
neighbourhoods that fosters poverty and lowers social mobility.

The rationale behind the implementation of the SHS to tackle the
problem of family breakdown and its adverse effects on children is not un-
founded. According to the economics theory of marriage, homeownership
functions as a financial and social resource before a marriage decision is
made. Ending a marriage would incur a cost, the loss of a house as a major
asset. Thus, homeownership can deter divorces.

Furthermore, there is a large body of research associating home-
ownership with family cohesiveness. In a longitudinal study conducted
by Grinstein-Weiss et al. (2014), which examined the relationship between
homeownership and the likelihood of marriage or divorce in the United
States, it was found that among the study’s sample population, the pro-
pensity to divorce in married homeowners are less likely than married
renters. Similarly, in an earlier study by White and Booth (1991), using an
American national panel of married individuals, it was established that
homeownership and the possession of assets can act as a barrier to di-
vorce.

These findings lend empirical support to the Report’s proposition
that by possessing a property asset, a home, it can play a significant role in
mitigating the increasing trend of divorce. Moreover, because under our pro-
posal, application for the SHS is restricted to once in a lifetime, this will mit-
igate the perverse incentive to divorce. As a result, the social, political, and
economic costs of family breakdown can be allayed. Children would be less
likely to bear the adverse consequences of a separated mother and father,
and would experience a safer, more stable, and rewarding childhood.

7.3 SHS and Upward Mobility

Murray (2012) and Putnam (2015) had both shown that intergener-
ational inequality is an endemic problem in society. The situation in Hong
Kong is not different. It is caused and exacerbated by our public housing
policies that have divided the population into the ‘haves’ and the ‘have-nots’.
This dooms the ‘have-nots’ to a cheerless future, mired in poverty and crip-
pled by social immobility.

A critical concern for Hong Kong to address in coming up with a long-
term housing strategy is to appreciate the important role of housing assets
as a store of value for upward social mobility and human capital investment.
There is a possibility that social upward mobility would be greatly improved
if property assets are held. The fundamental reason why social upward mo-

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