Housing Rent Needs Control

I was
interviewed via email by an Apple Daily reporter last week, who asked for my
comments on the housing strategy as laid out in CY Leung’s Policy Address.

This was my
reply in full (in Chinese):-

梁特首施政報告中之房屋政策給我的印象係:長遠而言,地房屋供應的陸續增加或會緩和地產霸權對市場的操控, 但弊處係遠水不能救近火!

我特別不明白他抗拒恢復租金管制的理由,他說租管可能產生反效果,但卻無解釋有何反效果;我曾聽過一些反租管人士所持論點,就係租管會令業主們不肯將手持單位放租,從而令整體出租單位減少及租金進一步上升,我祗想反問一個簡單問題,對物業投資者而言,少些租金收入還是完全無收入較為可取?我覺得反租管者祗從私利出發而對無殼蝸牛毫無同理心,亦可說是歪理連篇。

若要認真解决低收入人士之燃眉居住問題,最直接及最合理方法莫過於立刻實施針對中小型單位及劏房之租金管制。

紐約市自1969年以來施行租金穩定法例 (Rent
Stabilization Law), 其目的在幫助低收入人士租住居所,一向行之有效,值得梁政府細心研究及仿傚。

Translated
Version:-

The impression I get from the CE’s Policy Address on
his housing strategy is that for the longer term, gradual increases in land and
housing supply may perhaps serve to slightly loosen the property cartel’s tight
grip on the property market; however, supply increase, which cannot happen
overnight, is hardly an antidote for quenching the immediate housing thirst.

I am particularly puzzled as to why the CE resists
reviving rent control. He kept saying that it might be counter-productive, but
fell short of an explanation. People who are against rent control have a
theory. They hold the view that rent control would discourage property owners
from letting out their rental properties, which would thus put a squeeze on the
number of available rental units and force up rents further. My only question
is: from a property investor’s standpoint, which would be a preferable option:
getting a little less rent or getting no rent at all? It seems to me that those
rent control naysayers are just being selfish and totally callous towards the
plight of people seeking (but not finding) affordable rental housing and their
theory is flawed.

In order to help the low income group to get
affordable shelter, the most direct and most rational solution would be to impose
rent control targeting medium- to small-size flats and subdivided flats.

New York City (the bastion of capitalism not unlike
Hong Kong) has been operating a Rent Stabilization Law since 1969, aiming to help
low- to middle-income people get/remain in affordable rental homes. (One
condition for the law to be operative is when the city’s rental vacancy rate is
less than 5%.) That law may be worth studying.

Link for reference:-

 http://en.wikipedia.org/wiki/Rent_control_in_New_York

Postscript:-

In view of the stratospheric level of property
prices and rents now prevalent, giving home renters some sort of protection against
obscene rent increases and possible eviction would obviously be a more prudent
measure than luring them into the trap of purchasing homes (even subsidized
ones) beyond their means at or near a price peak. Longer term, renting should
always remain an available alternative to purchasing with appropriate
regulations giving tenants security of tenure and protection from unreasonable
rent increases demanded by landlords. Obviously, the rent control regulations
that served Hong Kong so well pre-1997 were abandoned at the behest of vested
interests.   

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