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Right rules, wrong effect

(China Daily)
Updated: 2010-12-20 08:02

The Ministry of Housing and Urban-Rural Development recently issued a set of rules to curb group rentals. The rules, though aimed at protecting tenants' rights, are disadvantageous to most low-income tenants, says an article on rednet. Excerpts:

The rules stipulate that a house cannot be divided into a number of small units and rented out to a group of people. The rules have been issued to ensure that each tenant gets the minimum living space stipulated by the city where the building is. The rules forbid homeowners to raise the rent unilaterally before the contract expires, too, to protect tenants' rights.

The reality, however, is that the rental market is dominated by homeowners, who can decide whether or not to rent, who to rent their houses to, and how much rent to charge the tenants.

Thanks to the rules, tenants who could barely afford group rentals would be driven into a tight corner. They will either have to pay higher rent or become "homeless".

Seen in this light, the rules don't do much good to tenants, especially those with low income levels. Worse, given that housing prices show no sign of stabilizing, let alone falling, group rentals are probably a better choice for many low-income individuals and families.

The rules also have the potential to make homeowners negotiate rent deals clandestinely and make it even more difficult for officials to monitor the housing market.

The ministry needs to take measures to control and reduce housing prices/rents, and make the requirements for low-income/low-rent house application more flexible. More importantly, government departments should realize that it is important to solicit public opinion before deciding any policy.