Draft regulation may stop landlords from exploiting tenants

ON FRIDAY, the Ministry of Housing and Urban-Rural Development solicited public opinions on a draft regulation that imposes harsher restrictions on landlords to prevent them from arbitrarily increasing rents without good reason. Beijing News commented on Sunday:

For the some 160 million paying to live under someone else’s roof in cities and towns, their struggle with some greedy, irresponsible landlords may soon come to an end. Tenants are encouraged to take up a lease of three years or more with their landlords and pay the rent monthly, according to the draft regulation. Landlords are prohibited from raising the rent if the contract does not include how often and to what extent they are allowed to do so.

Many real estate agents and landlords have long preyed upon tenants, who account for about 21 percent of the total permanent urban population. The cost of renting can be exceedingly high for those who have just landed a job after graduation, as in most cases, apart from the unreasonably high agency fees, tenants have to pay four months rent in advance for a quarter lease, because the landlords require the extra monthly rent as a deposit.

Up to now tenants’ legal rights have also been poorly protected. Landlords could easily find loopholes in the lease and charge extra fees despite no rules allowing them to do so. When questioned, they will point to a steady rise in the average rent.

Affordable rented accommodation should be the least a city can offer to non-locals. A lot of countries have strict regulations covering the rental market. In Germany landlords are not allowed to increase the rent more than 20 percent over three years, which, to some extent, explains why only less than half of the country’s households have homes of their own.

China could well learn from the experiences of other countries not just to cool down house prices but also to regulate the rental market.