HONG KONG — The Hong Kong Government has launched the Basic Housing Units (BHU) Ordinance on Sunday, marking a major step to regulate substandard subdivided units (SDUs) and improve living conditions for 220,000 residents across Hong Kong. While aimed at ensuring safer homes, critics fear the rules could displace the city’s poorest tenants through evictions and rent hikes.
A four‑year roadmap to clean up subdivided flats
Under the new law, owners of SDUs must register their properties with the Housing Bureau and meet specific standards to obtain licensed basic housing, before legally renting them out.
The government has adopted a “registration first, enforcement later” approach, opening a 12‑month free registration window for existing SDUs, followed by a 36-month grace period for owners to adjust tenancies and submit recognition applications, creating a four‑year transition that runs until February 28, 2030.
Criminal liability for illegally letting unregistered and unrecognised SDUs will only take effect from March 1, 2027, with the Housing Bureau promising a “pragmatic, people‑oriented and risk‑based” enforcement strategy designed to avoid mass displacement of tenants.
Housing Secretary Winnie Ho welcomed the new legislation and noted that about 30 per cent of the city’s 110,000 subdivided flats will need upgrading, with owners given four years to comply. She added that not all units will be renovated at the same time, so demand for transitional housing should remain manageable.
“Nearly 30,000 subdivided flats do not meet the bill’s minimum floor area requirement of 8 square metres,” she said.
To smooth the transition, the Housing Bureau’s Dedicated Team on Subdivided Units will coordinate with six District Service Teams to help affected households secure alternative accommodation.
Tenants left in the lurch
Despite landlords facing significant compliance costs under the new ordinance – including up to HK$50,000 in certification fees for a flat divided into four units – Ms Ho dismissed concerns that these expenses will drive up rents, insisting BHU prices will remain stable as the government will provide sufficient public housing for those in need.
However, some Hong Kong residents have expressed concern about the ordinance. Households on Fa Yuen Street in Mong Kok warned that even modest rent hikes after costly renovations could prove unaffordable, especially if landlords choose to reclaim flats, consolidate units or shift into more lucrative leasing models.
“The landlords will no doubt exploit us. It’s unfair. I’m already paying HK$5,500 per month for a cramped space,” said Ms Kwok, a Hong Kong resident.
As SDUs are upgraded or taken off the market, tenants are also facing a surge in forced evictions. More than 100 households in Cheung Sha Wan’s Yee Wa Building were forced to relocate last month after landlords moved to upgrade flats.
The rise in tenant evictions is nudging residents toward cheaper and unregulated industrial units. Since SDUs in industrial buildings are illegal under the Buildings Ordinance, they fall outside the new BHU regime. This has become a selling point for tenants fleeing regulated residential SDUs to cheaper industrial setups.
Ms Chan is a prime example. A single mother of two, she lives in a 100-square-foot subdivided flat on Bute Street in Mong Kok. When asked about her situation, Chan said, “It’s already tough making ends meet. If the rent goes up we’ll have no choice but to consider moving into factory buildings. It’ll force us out. I don’t want that for us, but what else can we do?”
She added that the Yee Wa Building case is just the tip of the iceberg and that “evictions will become widespread”, pushing the city’s poorest into the shadows of an already fractured housing market.
