WEDNESDAY, MAY 25, 1983
PREWAR PREMISES RENT INCREASE
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THE LEGISLATIVE COUNCIL TODAY PASSED A RESOLUTION TO RAISE PERMITTED RENTS IN PREWAR PREMISES.
THE INCREASES ARE BASED ON THE STANDARD RENTS PREVAILING IN 1941.
FOR PREWAR DOMESTIC PREMISES, THE PERMITTED`RENT IS RAISED FROM TWELVE TIMES TO SIXTEEN TIMES THE STANDARD RENT AND FOR BUSINESS PREMISES, FROM TWENTY-SEVEN TIMES TO FORTY TIMES THE STANDARD RENT.
LANDLORDS ARE REQUIRED TO SERVE THEIR TENANTS WITH ONE MONTH'S NOTICE OF THE INCREASED RENTS.
MOVING THE RESOLUTION IN THE LEGISLATIVE COUNCIL TODAY, THE ACTING SECRETARY FOR HOUSING, MR BERNARD WILLIAMS, SAID THERE WERE 8 500 DOMESTIC AND BUSINESS PREMISES IN PREWAR BUILDINGS, ABOUT 4 700 OR 55 PER CENT OF WHICH WERE EFFECTIVELY SUBJECT TO CONTROLS UNDER PART I OF THE LANDLORD AND TENANT (CONSOLIDATION) ORDINANCE.
THE REMAINING 3 800 UNITS ARE EITHER OCCUPIED BY OWNERS, SPECIFICALLY EXCLUDED FROM CONTROLS OR LET AT RENTS AT OR APPROACHING MARKET LEVELS.
MR WILLIAMS SAID DESPITE ANNUAL INCREASES SINCE 1976, AVERAGE PERMITTED RENTS OF PREWAR PREMISES SUBJECT TO THE PART I CONTROLS STILL RANGED FROM ONLY 25 TO 36 PER CENT OF PREVAILING MARKET RENTS.
+THIS IS DUE TO THE VERY LOW BASE ON WHICH RENT INCREASES ARE CALCULATED, UNLESS FURTHER INCREASES ARE ALLOWED, THE GAP BETWEEN EXISTING RENTS AND MARKET RENTS WILL WIDEN, + HE EXPLAINED.
ABOUT 3 200 DOMESTIC UNITS IN PREWAR BUILDINGS ARE LIKELY TO BE AFFECTED BY THIS ADJUSTMENT. FOR A TYPICAL UPPER FLOOR TENEMENT UNIT, THE ADJUSTMENT WILL RESULT IN AN INCREASE OF ABOUT $160 PER MONTH, BRINGING THE RENT TO ABOUT $650 OR 38 PER CENT OF PREVAILING MARKET RENT.
FOR A TYPICAL COMMERCIAL GROUND TENEMENT FLOOR, THE INCREASE WILL BE LESS THAN $1 100 PER MONTH, BRINGING THE RENT TO ABOUT $3 300 OR 52 PER CENT OF PREVAILING MARKET RENT, ABOUT 1 400 UNITS ARE LIKELY TO BE AFFECTED.
MR WILLIAMS POINTED OUT THAT THIS ADJUSTMENT WAS THE LAST TIME RENTS FOR PREWAR BUSINESS PREMISES WOULD BE REGULATED UNDER PART I.
THERE IS ALREADY PROVISION IN THE ORDINANCE FOR THE EXCLUSION OF BUSINESS PREMISES FROM RENT CONTROLS WITH EFFECT FROM JULY 1, 1984.
THEREAFTER