ENG-1994 — Page 251

214

HOUSING

Under Part II, landlords and tenants are free to agree on an increase in rent, but such agreements must be endorsed by the Commissioner of Rating and Valuation. Increases, except by agreement, are permitted only once every two years. Where an increase cannot be agreed, the landlord may apply to the Commissioner to certify the increase which may be made to the current rent. The permitted increase is arrived at by taking the lesser of (i) the difference between the prevailing market rent and the current rent or (ii) 30 per cent of the current rent. However, if the increase so determined, when added to the current rent, results in a rent less than a specified percentage of the prevailing market rent, the permitted increase will be the amount necessary to bring the new rent up to that percentage of the prevailing market rent. The minimum percentage, previously set at 75 per cent, was adjusted to 80 per cent in July 1994. It will be increased in stages to 85 per cent and 90 per cent in July in 1995 and 1996, respectively, to allow rent controls to be phased out by the end of 1996. Both landlords and tenants may apply to the Commissioner for a review of his certificate and may further appeal to the Lands Tribunal against the Commissioner's review.

The sitting tenants of nearly all domestic tenancies not subject to Part I or II controls are provided with security of tenure under Part IV of the ordinance, as long as they are prepared to pay the prevailing market rent on renewal of their tenancies. However, Part IV does not control rents. The legislation stipulates that a further tenancy must be granted to the tenant, unless the landlord can satisfy the Lands Tribunal that he requires the premises for his own occupation, or that he intends to rebuild the premises, or on one of the other grounds specified in the legislation. The parties are free to agree on the rent and terms for the new tenancy but, failing agreement, they can apply to the Lands Tribunal for a determination. Provisions also exist enabling tenancies to be transferred, under certain statutory condi- tions, from the ambit of Part II to Part IV.

Parts II and IV of the ordinance provide for the payment of statutory compensation to tenants dispossessed by the rebuilding of premises. The level of compensation is based on a multiplier of 1.7 times the current rateable value of the concerned property.

The Housing Authority

To take overall responsibility for the rapidly growing public housing programme, the Hong Kong Housing Authority was established on April 1, 1973, under the Housing Ordinance, combining a number of bodies which had been dealing with housing and resettlement

matters.

The authority was re-organised on April 1, 1988 and given a separate financial identity and autonomy, together with sufficient flexibility to deal with the priorities set by the Long Term Housing Strategy.

The Housing Authority advises the Governor on all matters relating to housing and through its executive arm, the Housing Department, plans and builds public sector housing, either for rent or ownership, and temporary housing areas.

It manages public housing estates, home ownership courts, temporary housing areas, cottage areas, transit centres, flatted factories and the ancillary commercial facilities throughout the territory, and administers the Private Sector Participation Scheme and the Home Purchase Loan Scheme. It acts as the government's agent to clear land, prevent and control squatting, and implement improvements to squatter areas.