'Subdivided Flat Rent Control Unfair To Landlords'

A representative of a landlord group complained on Tuesday that the government had labelled them as “bad and mean people” in a proposed law to cap the rent rises for subdivided flats.

Diamond Shea, president of the Hong Kong Owners Club, told an RTHK programme that the policy gives too much protection to tenants, after the government announced a day earlier that it would lower the cap from 15 to 10 percent.

“The government’s rental control policy totally favours the tenants. It even labels landlords as bad people or mean people. We don’t know why that is,” he said.

Shea said landlords are also very upset about the proposal to fix a lease for two years, and to give the tenant priority to renew it for another two years on expiry.

“Different groups in society, or the so-called political social workers, are just trying to turn private flats into public housing. But they forgot public housing are government resources, but landlords have to save up bit by bit before they can afford private flats,” he said.

He said the policy is an intervention in the market and may eventually reduce supply and hurt tenants, because landlords may leave the market by turning subdivided units back into a single flat for rent or sale.

Shea said he, for one, had sold his flats.

“I quit. I quit for real. I am not interested in fooling around with them.”

However, speaking on the same programme, DAB lawmaker Vincent Cheng said he doesn’t think a lot of landlords will leave the market because the profit margin is still very large.

He noted that rent hikes for subdivided flats are often at a higher rate than the rest of the market, and the cap will hopefully slow this down and put the situation in line with public housing.

Cheng added that the government should eventually look at how to phase out subdivided flats altogether.