Since the prices of building maintenance projects are lacking in transparency in Hong Kong, owners face difficulty in evaluating whether the prices are reasonable or not.
A reference book, commonly known as “the Book”, is a schedule of rates for district term contract of Hong Kong Housing Authority. It is used inside government departments to conduct valuations for projects and assess whether the tender price is reasonable. The Book has never been released to public.
In response to FactWire’ enquiry as to whether the Book should be made available to public or not, the Competition Commission stated that should private organizations, industry associations or statutory bodies provide a pricing list for construction projects or prices for “references”, it could affect the pricing competitions between market participants and result to a situation similar to price fixing. However, the possibility of harming competition would be lower if such references are integrated historical statistics and provided anonymously and openly. This way, it would be safer to provide consumers with data for comparison.
As the Book meets the criteria of being “integrated historical statistics” that was “provided anonymously”, and that by making the Book available to public, market transparency would be increased, FactWire decided to publicize the Book based on public interest. When choosing between tenders, flat owners could hire independent professionals to calculate whether the building maintenance prices are in reasonable range under governmental standards.
The Book is published by the Quantity Surveying Management Unit of the Housing Authority Estate Management Division. Data of the previous year would be issued every June. The latest 2015 version was published in June last year. The first part of the Book contains instructions and details about 28 types of construction work, including scaffolding, concrete, plumbing, painting and such like. It covers more than 15,000 project prices including labour and parts. The second part lists out the standards for operation and supervision.
A surveyor who participated in drafting the Book said that the Book can be used for basic reference when conducting valuations. He stated that some reference prices in the Book are higher than market prices while some are lower, and both the content of maintenance projects and choice of materials would affect the valuation margin. However, a major portion of the maintenance fee is derived from fundamental projects such as scaffolding and setting up drainage channels, and materials used for both private estates and public housing are similar. Projects which involve using expensive materials, such as wall tiling, only take up a small proportion of the building maintenance project as a whole.
FactWire acquired the 2013 and 2014 edition of the Book through two channels. The 2013 edition contains pricing lists and standards for operation and supervision of building maintenance projects, while the 2014 edition contains the pricing lists. Both editions are now available online.