Penang mulls reviving rent control

Penang is mulling whether to bring back rent control act to curb spiraling rental rates, July 4, 2016. — Picture by KE Ooi
Penang is mulling whether to bring back rent control act to curb spiraling rental rates, July 4, 2016. — Picture by KE Ooi

GEORGE TOWN, July 4 — Increasing cases of eviction within the George Town Heritage zone has spurred the state government to consider enacting of an amended version of the abolished Rent Control Act.

Penang Chief Minister Lim Guan Eng today announced the state executive council’s decision to evaluate the option as a way to allow existing residents to remain within the heritage site.

“We are proposing reinstating a reasonable version of the Rent Control Act for all pre-war heritage houses within the zone to prevent gentrification of the heritage site,” he told a press conference at his office today.

He expressed the state’s concern over the recent increase in evictions of existing residents due to spiralling rental rates, especially after the prewar houses were bought over by foreign investors.

Lim explained that his administration was aware of the phenomenon, but initially resisted intervening in the free market.

The Rent Control Act that used to keep rental rates at a minimum was abolished in 1997, and since then, the rental rates have increased dramatically.

Lim said when the Act was abolished, it was done under Article 76 (4) of the Federal Constitution under which Parliament has the power to legislate for the states for the purpose of uniformity of law and policy.

“So we need to get the state legal adviser’s views on whether enacting a rent control act is under federal or state jurisdiction,” he said.

In the meantime, George Town World Heritage Inc (GTWHI) will take charge of a secretariat in getting public feedback on the rent control proposal while state executive councillor for local government, Chow Kon Yeow, will head a committee looking into details of the proposed enactment.

State exco for housing Jagdeep Singh Deo will look into the legal aspects of re-introducing the Rent Control Act.

Lim assured house owners and tenants that the rent control measure will be reasonable and ensure that rental rates were increased at a reasonable rate of 20 per cent within a five-year period instead of the current 100 per cent to 200 per cent increases.

“If this is out of the state’s jurisdiction, I will submit a private members’ Bill to implement the Rent Control Act for the heritage zone,” Lim said.

In recent years, the inner city has seen massive outflow of original tenants and traditional trades as rental rates increased and more prewar houses were bought over by local and foreign investors.

Lim said the state needed to do something to protect these original tenants and traditional traded that make up the living heritage of the city.

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