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Group to mull rent controls

People sit in front of their rented room in Phnom Penh
People sit in front of their rented room in Phnom Penh last year. A working group will meet for the first time on Tuesday to discuss new rent controls, aimed at protecting the public from price hikes. Hong Menea

Group to mull rent controls

The ruling and opposition parties announced on Saturday the creation of a new working group to discuss a bipartisan plan to table a rent control law that will regulate rising housing prices and sudden rental hikes for all tenants in the Kingdom.

The establishment of the group comes after a joint agreement between Prime Minister Hun Sen and CNRP leader Sam Rainsy on February 10 to conceive a law that will protect the interests of renters.

Originally, the plan focused on poor students and garment workers, who have experienced drastic rental surges after their monthly minimum wage was raised to $128 in November, but working group deputy and Cambodia National Rescue Party lawmaker Ou Chanrith said they are expanding the law’s scope to cover the rest of Cambodia.

“This law will focus on all tenants and landlords in Cambodia and not just any specific groups, but we hope that it will greatly benefit factory workers and students who are renting rooms,” Chanrith said.
The eight-person group, which will conduct its first meeting on Tuesday, consists of four members each from the ruling and opposition parties.

According to Chanrith, the upcoming law is expected to include clauses covering caps on rent prices and scheduled increases, sanitation standards for all rental units and the creation of binding rental contracts between renters and tenants that could be readily accessible in administrative offices around Cambodia.

“With this law, we want to ensure that renters and homeowners are not abused in any way and we will make sure that there would be penalties for those who don’t follow this,” he said.

The policies, however, are still up for debate and Cambodian People’s Party working group member Pal Sam Oeun said they will have a more concrete idea of what the new law would entail following the initial meeting.

The rent-control law has so far been well-received by labour unions and NGOs alike, but to ensure its effectiveness Housing Rights Task Force secretariat director Sia Phearum said the working group must “engage other stakeholders in meaningful conversation”.

“This seems like a good plan but we just want to make sure that NGOs, civil society, experts and the public are included in the conversation to ensure that it will benefit the people and not just make the politicians look good,” Phearum said.

Rent-control has been an oft-debated concept internationally and if executed haphazardly, said Century 21 Regent Realty CEO Nguon Chhayleang, it could serve as a “double-edged sword”.

“The good in this is that the government can control how much the landlords could charge tenants and make rents more reasonable than what it is today,” Chhayleang said. “But on the negative side, it can affect the confidence of some investors hoping for a high return on investment.”

To avoid damaging ripple effects, Chhayleang suggested that the working group closely study the market and consult experts to develop informed guidelines.

Chanrith said they are planning “consultations with experts and civil society”.

“We want to ensure that this is done right,” he said.

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