[StevenWaterman]

In Hong Kong, it's not a problem of over-densification. There's loads of unused land, but the government is incentivised to keep it empty and not zone it for high-density residential. When they do sell off a small parcel of land for new development, they auction it off leading to obscene land prices.

That's what OP means about there not being an incentive for the government to lower cost of living. The high cost of living is subsidising HK's notoriously low taxes.

There's a pretty good YouTube video about it: https://www.youtube.com/watch?v=hLrFyjGZ9NU

Oh and to answer the question, the solution is to zone lots more high-density residential, sell a lot of land for less money, and stop subversively taxing the poorest citizens via high CoL. Tax businesses and the wealthy to make up for it. But they're not going to do that, because low taxes on businesses and the wealthy is their USP.

Turns out when you optimise a city for business wellbeing at the expense of citizen wellbeing, then it impacts citizen wellbeing...

[bennysomething]

Fair points. Didn't know about the gov land sales. Honestly I presumed I was going to hear "rent controls!"