5
view as to whether a new estate is more or less valuable
and to what extent the differences in value should be
reflected in $/m2 in rents. This has also been a useful
yard-stick in setting rent on account of the many different types of public housing estates in various parts of the
territory.
The Committee recommends that the current method
of setting and reviewing rent level by taking into account
tenants' affordability and comparative estate values should
continue. The present system however does not set a maximum
level for public housing rent.
This
The only significant change proposed by the Committee
is the adoption of a maximum median rent-income ratio.
recommendation has caused a great deal of public concern and
discussion.
A rent-income ratio is the expression of rent as
a percentage of income. The Committee proposes to adopt a
maximum rent-income ratio of 15% for the Authority's new
estates at the current standard. According to the preliminary
statistics for 1985-86, the median rent-income ratio for
households rehoused in that year was 12.4%. Of these
households, 72.5% of them paid a ratio of less than 15%, 22.3% of them paid 15% up to 25% and 5.2% of them paid 25%
or more. The last group included public assistance recipients
whose rents were paid for by the Social Welfare Department
and tenants who opted for higher space standards.
Of the
/Authority's