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THURSDAY, JUNE 22, 1989
IT WILL ALSO INCREASE FROM 39 TO 43 TIMES THE STANDARD RENT FOR THE PERMITTED RENT OF PRE-WAR DOMESTIC PREMISES.
IN ANNOUNCING THESE PROPOSALS, A GOVERNMENT SPOKESMAN EXPLAINED THAT THEY WERE DRAWN UP FOLLOWING ANOTHER REVIEW OF WORKING OF THE ORDINANCE, AN ASSESSMENT OF MARKET CONDITIONS HAVING REGARD TO THE INTERESTS OF BOTH LANDLORDS AND TENANTS,
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THESE MEASURES ARE IN KEEPING WITH THE GOVERNMENT'S PREVIOUSLY STATED INTENTION TO PHASE OUT RENT CONTROL WITHOUT CAUSING ADVERSE SOCIAL CONSEQUENCES, HE SAID.
SYSTEM
DESPITE A SERIES OF ADJUSTMENTS TO THE RENT INCREASE WITH THE OBJECTIVE OF RAISING CONTROLLED RENTS CLOSER ΤΟ THE LEVEL, THE DISPARITY BETWEEN CONTROLLED AND MARKET RENTS CONTINUES.
MARKET
THE REMOVAL OF RENT CONTROL AT THIS STAGE WOULD MEAN THAT THESE TENANTS WOULD HAVE TO FACE RENT INCREASES OF VARIOUS MAGNITUDE APPROXIMATELY 20 PER CENT WOULD HAVE THEIR RENTS DOUBLED. THE LIKELY HARDSHIP AND DISLOCATION COULD BE SERIOUS AND SOCIALLY DISRUPTIVE.
THE EXTENSION OF THE LIFE OF PART II OF THE ORDINANCE, WHICH IS DUE TO EXPIRE ON DECEMBER 18, 1989 BY TWO YEARS WILL CONTINUE THE DUAL PROTECTION OF RENT CONTROL AND SECURITY OF TENURE TO TENANTS OF ABOUT 60,000 WHOLLY-LET DOMESTIC UNITS AND AN UNDETERMINED LETTINGS AND SUB-LETTINGS OF SUB-DIVIDED ACCOMMODATION.
NUMBER OF
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IN LINE WITH THE GOVERNMENT'S POLICY OF PROGRESSIVE IT IS PROPOSED TO INCREASE, WITH EFFECT FROM DECEMBER 19 THIS YEAR, THE MINIMUM PERCENTAGE COMPONENT IN THE RENT INCREASE MECHANISM IN PART II FROM 60 PER CENT TO 65 PER CENT OF THE PREVAILING MARKET RENT, A LEVEL TO BE REACHED BY ALL CONTROLLED RENTS.
ASSUMING THAT MARKET RENTS REMAIN RELATIVELY STABLE, THIS WILL HAVE A NET EFFECT OF INCREASING THE NUMBER OF TENANCIES AFFECTED BY THE MINIMUM PERCENTAGE COMPONENT BY 883 AND INCREASING THE AVERAGE CONTROLLED RENTS BY $18 PER MONTH.
THE SPOKESMAN HOWEVER POINTED OUT THAT THIS INCREASE WOULD ONLY AFFECT TENANTS WHO ARE CURRENTLY PAYING LESS THAN HALF OF THE MARKET RENTS AND HAVE IN FACT BEEN PROTECTED FOR A LONG TIME. EVEN THEN, THEY WILL CONTINUE то PAY SIGNIFICANTLY LESS TENANTS FOR COMPARABLE PREMISES, HE SAID.
THAN NEW
FOLLOWING THE ESTABLISHED POLICY OF ALLOWING ANNUAL INCREASES OF THE PERMITTED RENT OF PRE-WAR DOMESTIC PREMISES, THE FACTOR TO BE APPLIED TO THE "STANDARD RENT" (THAT IS, RENT AS AT DECEMBER 25, TO ARRIVE AT THE PERMITTED RENT WILL BE CHANGED FROM 39 TO 43.
THE PROPOSED INCREASE WILL AFFECT ABOUT 1,350 PRE-WAR UNITS EFFECTIVELY CONTROLLED UNDER PART 1 OF THE ORDINANCE.
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