THE CHINA MAIL, APRIL 14, 1938.
RENT REPORT "BARREN" Mr. Braga's Detailed Criticism Of Findings
FALSE
OF VALUE FOR BASIC RENT
STANDARDS, as the Code Com
Whether cases of this type have been co
menta subtratech) brought to the notice of the Commis-Tandlords
murected to close sion, and whether the Commission, in scrutiny before any valuable deduction pursuance of the powers vested in can be made from them. The removal them by the Commissioners Powers of disorderly houses from certain dis- Act of 1886, had subpoenaed any wit-tricts and their occupation by trades nesses before them and elicited similar and professions capable of paying high- starting revelations, one cannot teller rents; the absence of water service This is a moot point of some impor-and fireproof staircases and the provi- tance, and is considered to be a deter-sion of these in competitive premises mining factor for purposes of rental have a very material influence in de- comparison. Without it only an extermining the value of rents, so that Sir, The findings of sites," the honourable senior unofficial parte case has been made out. That it is doubtful if the conclusion
member said, "could be taken as proof is one contention.
of the comparative figures sub- the Rents Commission of a further increase in the popula- MILITATING EVIDENCE FACTORS mitted in. several paragraphs tion, as well as a healthy sign that: There are several reasons why the can be accepted. 25 incontestable are now available to the confidence in the future of the Colony collection of material evidence has not proof in support of any deductions in been as complete as it should other- the absence of material evidence in the public; they can be sub-was being restored."
Hong Kong's revenue for. 1928 ex-wise be. Its very incompleteness mother direction.
· DOMESTIC PROBING Ject to fair and impartial ceeded the Estimates by $4,865.009, and litates against the raine of the report,
of that of the previous year by the recommendations, accordingly, fall With all deference to the profession- criticism.
629.563, which prompted the official short of the requirements of the final character of the composition of the For example, there Commission, I make the submission From me nrst, His Excellency the author of the preface to the Adminis-damental data
tration Reports for 1928 to indulge in are the inherent shyness and timidity that the pursuance of the questioning Governor showed personal concern with this perplexing housing problema note of optimism when he wrote that of a class of witnesses to appear be to ascertain the number of domestics He revealed a solicitude for the public "1928 showed a continuation of steady fore the Commissioners; the restrain of a household in order to find out the recovery in the financial and commering influence of the language difficulty tenant's ab lity to meet his rent is weal that has earned recognizion and
experienced by foreign tenants in some undignifying and outside the Commis- gratitude. It is surmised thar a care-cial position of the Colony." CYCLICAL PERIOD
cases and illiteracy in others; and, sion's functions. The adequacy of the Il consideration of the various issues
The quotations should carry convic-lastly, fear of retaliation by landlords. rent in proportion to the accommoda- that had engaged His Excellency's at-
At the same time ample allowance rion provided and its suitability are tencion led to the conclusion that there tion that Hong Kong had emerged out was evidence that rents had risen and of the chaos created by the intensive must be made for the hasty nature really what matter. The argument anti-Hong Kong strike and boycott of (the phrase is of the Commissioners' which the Commission makes, that the were rising and that tenants in certain 1925 to enter upon one of those cycli-own coining) of the inquiry, because reduction in the wages of one servant. cases were put into difficulty, not to: say hardship. That much could be cal prosperous periods, during which of the alleged urgency of the posi- by dispensing with him might have there was much speculation in house tion and of the Chairman's pending provided the amount which the tenant gathered from his statement in Coun-
property. To attain the best results departure from the Colony."
needed to meet the increased rent, is cil On that account, continued the under the concomitant conditions of a Impartially, no blame can be attach-poor (page 16, para. 18). Its fallacy Governor, "closer and more systematic boom, rents were forced up in ordered to the Commission. That much is will be made more evident if the ana- investigation of the facts in relation to that the investments in property might granted. If they had not been placed flogy is extended to, say, the case of all relevant circumstances was neces-bear the most favourable relation be in the position for a judicial sifting of an individual earning a salary of $2,- sary before such a far-reaching meatween capital cost and interest yield cases in the interests of tenants the 000 or so a month. Does it necessar- sure could properly be presented This view places in doubt the ipse latter are at fault.
ily follow that he should pay out a per- the Council.”
dixit of the Commission in para. 2 that In the first place let it be noted that the majority of property owners must
centage in rent equal to that paid by ASSOCIATION
his humbler follow-citizens? - the fundamental grievance of the ex-be regarded as legitimate investors."
If the
istence of hardship had been
It is learnt from the Report that argument is to hold, a percentage Not all will agree with their claim complaints had been received from the high as 50% and more is not unknown. tabushed to His Excellency's satisfac- tion, hence the appointment of
-LOANS ON INSUFFICIENT- the
Kowloon Residents' Association, and in The case of a modest Chinese cashier Commission.
a summary which a deputation from in foreign employ, and another of measure" Sir! Xumerous changes of ownership that Association presented to the Com-Filipina laundress, can be cited Geoffry Northcote had in mind was arose out of the speculative spirit mission it was supposed that there were specific instances by whom I have been the advocacy he had received from which seat prices up during the recov-six cases of startling rent increases approached By further analógous ar- various quarters that legislationary period; these changes accompan-exceeding 150%. Some satisfactory guing, there was nothing to prevent the Commission probing into a family's should be passed at once which woulaied the inevitable reaction that set in explanation should be forthcoming as give greater protection to the holders and Hong Kong began to fall tempor- to why the Commission
or the husband's did not dis-daily bill of fare, or exisung tenancies than that which arily on evil days. This condition was cover any such huge increase as was drinks and "smokes," and the family common 197 and local statutes now aggravated by the failure of some of alleged in the summary given by the amusement costs for cinema and other provice and, conversely, would res-the native banks which created a panic Committee's deputation.” It is inconforms of recreation.
"Good ceivable that such trict the existing rights and powers bordering on an acute crisis.
a representative or landlords."
property in widely scattered areas was body like the K.RA. can be capable of An aspect of the question that does practically unsaleable. ROOT OF SITUATION
Such might gross exaggeration.
not appear to have been touched upon To complete
is that of the the necessary back-have been the condition of the Colony On salient fact emerges on the au-by the Commission
Assessor farming of whole blocks of houses. To ground for an appreciation of these that furnished, to quote verbatim from thority of the Government crimcisms of the Commission's findings the report, "a wealth of evidence (pre-that "of the vacancies on his list at avoid having to deal with individual and so that no prejudice can be aur sumably supplied by landlords them-present not one was suitable for the tenants of fiets, not to speak of cubi- buted to them, it must be rememberco selves J. P.B.) to prove that owners Portuguese. clerical class or European cles, owners make it a point of farm- ing. The farmer agrees to lease the that the Commission's terms of refer- of house property were the victims. of subordinates." (Page 15, para. 1).
There are so many factors influen-i
(Continued on Page 9) ence included the wish for information 2 disastrous sluming the years The Commissioners in respect of the prevalent charges 1938 to 1937.* for rent in the towns of Victoria and were careful to guard themselves in Kowloon, having regard to their rise the assertion that "no doubt there were and call during the last ten years, and during the last ten years cases of spe- the extent to which and the manners culative Building in which men of straw in which tenants and landlords have hoped to make a quick boom proft" been and are being affected by the sud-
the height of the speculation den growth of the population of Hongmoney was borrowed at high rates of Kong since the beginning of Sino-la-interest. House property was bought panese hostilities last year.””
on wholly insufficient margin. A tempt- The Commission found difficulty in ing high rate of interest operated as giving a continuous history" of the the bait for smaller margin. A series failures synchronized rise and fall of rents during the last of mortgagors ten years, On their own admission with inevitable foreclosures that fol- this fact is of great significance and lowed in the wake of the incautious goes to the root of the present situa- scramble to get rich quick
The far-reaching
At
MARGIN
On
tion of rents in the Colony." No ex- In the present controversy the new planation is given for this statement. Owners successfully enlisted sympathy This is unfortunate. Tenants wereby the representation that current ren- unable to furnish that "continuous bis-tals suffer by comparison; they do not tory."
yield, they say, an economic return oz their money. TEN YEARS AGO
A candid admission is obtained The fundamental level of ten years page 10 of the cogency of the forego- 2go provides considerable useful data ing argument when the owners confess for the reasons I will now explain. For that they had "acquired the properties 1928-29, it will be remembered, a big as mortgagees and entered into posses- surplus balance was recorded for Hong sion during the depression
The Kong. It fell to the Hon. Mr. (now net return with the proposed increases Sir) Thomas Southom to review thewill not cover the interest charges on financial position of the Colony when the amount advanced on mortgage. presenting the Estimates for 1929, The
FALSE STANDARD » Officer Administering the Government It follows, therefore, that the over- said on the 20th September, 1928: "The valuation of property ten years ago does revenue of the Colony has shown anot furnish a true basis for purposes remarkable recovery. There is no of doubt that the population of the Co- such a standard is misleading and con- comparison. The application of lony has been increasing during the flicts with tenants interests to-day. year, and as the vacant houses are oc- By contrast, cases
can be cited
of cupied an impetus is given to building forced sales and foreclosures proving operations 2nd land purchase for what a profitable yield the existing which considerable funds seem to be rentals supply. Here is an illuminat- available."
ing example of an investment of $9,- Our veteran (then senior) unofficial 000 by a non-European landlady in a member, Sir Shou-son Chow, express-house in the European residential dis- ed the gratification of his colleagues trict of Kowloon from which she col- when he spoke of estimated revenue lects in rent the sum of $160 per month. for 1928 as likely to be exceeded by She had spent $2,000 in reconditioning the sum of not less than $2,571,000. the premises. This may appear to be That, he thought, might be taken as an extreme case; but if enquizy wer evidence that conditions in the Colony to be pursued far enough other similar were gradually returning to normal cases could be found as strikingly tav- "The bigger demand for building ourable to the landlord.
-
KOWLOON RESIDENTS:
+
j
FARMING MONEY
TRAVEL
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