Rental increase

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  1. #1
    deleteduser

    Exclamation Rental increase

    Well our 2 year rental contract is coming up. We walk by our realtor's office all the time, so we stop by and chat often. She has been mentioning lately that the property value in our area has been going up, so we shouldn't be surprized of our landlord asks for an increase in rent when the contract is due.

    Tonight we got that call

    He said that he was thinking of $9500 per month - right now we are paying $8300. I already think that is too high for how basic the accommodation is here, but only after living here for 2 years.

    Anyway, has anyone else witnessed rent going up by over $1000 per month in just 2 years? Is that normal for this whacky country? I don't see how they can justify such an outrageous increase in rent. After all, just because the property value goes up, doesn't mean it's costing them anything more to rent it out to us. Maybe a touch extra in land taxes, but I'm not even sure how that works here.

    Obviously that is just his opening offer, and he's expecting us to bargain. However, I do not want to spend a dime over what I am paying now. If anything, I think the rent should go down! Not that the place is disgusting, just that everything is very... basic. I am actually quite happy here, and would be happy to stay for the same price.

    My concern is, if rent is flying high everywhere in Hong Kong, it might not be worth moving to another place. Moving is a big headache, and I like the area I am living in. I really like the building management, and my neighbours.

    Anyway, I was just wondering out loud how the rental situation has been for other renters in Hong Kong. Particularly if you're out in the non-central areas of Kowloon like I am.


  2. #2

    Join Date
    Jun 2004
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    sai wan ho
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    15% in two years sounds pretty reasonable in what is a pretty hot market. That said I wouldn't be overly pleased! As you say that's the opener so you can haggle. If you walk past the realtor's office everyday it shouldn't be too hard to find out what similar property is leasing for in the area and base your offer on that. I'd offer a little under market as you staying in the property saves the landlord a fair amount of buggeration and the agent commisson for leasing to someone else.


  3. #3

    Join Date
    Sep 2007
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    Yuen Long
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    Would you consider offering the landlord just under what he wants and also getting him to upgrade the apartment from basic?


  4. #4

    Join Date
    Jan 2006
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    Park Island
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    Before my lease was up, I went around looking at other units so that when my lease comes up, I would be able to bargain with my landlord. Well, I actually found something cheaper and better furnished and when my landlord wanted to raise my place, I moved out. Why pay more when I can pay less with better furnishing?


  5. #5
    deleteduser
    Quote Originally Posted by sunniefaith:
    Before my lease was up, I went around looking at other units so that when my lease comes up, I would be able to bargain with my landlord. Well, I actually found something cheaper and better furnished and when my landlord wanted to raise my place, I moved out. Why pay more when I can pay less with better furnishing?
    I only hope this happens for me... It sure doesn't look good though, looking online!

  6. #6

    Join Date
    Jan 2006
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    Park Island
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    2,057
    Quote Originally Posted by lowlight:
    I only hope this happens for me... It sure doesn't look good though, looking online!
    I did the online search and like you, was a little disappointed. But when I went on the physical hunt, it was different. But then again, I'm at Park Island so the rental situation might differ.

  7. #7
    deleteduser
    Quote Originally Posted by DavidHK:
    15% in two years sounds pretty reasonable in what is a pretty hot market. That said I wouldn't be overly pleased! As you say that's the opener so you can haggle. If you walk past the realtor's office everyday it shouldn't be too hard to find out what similar property is leasing for in the area and base your offer on that. I'd offer a little under market as you staying in the property saves the landlord a fair amount of buggeration and the agent commisson for leasing to someone else.
    Reasonable for rent though? 15% increase in rent in 2 years sounds absurd to me...

  8. #8

    Join Date
    Apr 2004
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    hong kong
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    3,484

    7%ish a year in this market seems REALLY cheap.

    Your living in an apartment block ?
    I bet the service charges have gone up PLUS a good rental rate should be judged as a % of the valuation of the property. The landlord is not there to do YOU a favor. Its a business and he needs a reasonable market return.

    Also you don't say how big or where your living is so how are people to judge if its OK or not.

    FYI - I live in a 3 bed, 2 bath, new, top floor with roof, village house. Nr Tai Po. In a secure courtyard of 3 houses.
    I am in my second year and pay 6,500. The landlord is putting tenants in the ground floor now at 7,500 and has advised us that we would pay 8,500 in the market today.

    Looking locally, last year, we thought we had negotiated a reasonable deal, considering the 2 baths, roof + the new factor. Now we have a tremendous bargain. If I have to pay 8500 I would consider myself still to have a bargain. BUT - and the landlords know this - there is always a deal around every corner, so feel free to negotiate.


  9. #9

    Join Date
    Jul 2007
    Posts
    97

    $9500 is pretty cheap for HK... The increase is not big at all.


  10. #10

    Nothing is reasonable when it comes to houses in Hong Kong, that is for sure.

    One thing to remember is to remind the landlord of your bargaining power, remember that it is not a one way game.

    As already said, find prices on comparable flats, if that doesn't work to your favour one thing that I have found effective is to remind him/her that you are a stable tenant and remind of him/her of the costs involved in finding a new tenant, and that it will most certainly take many months for the landlord to recoup rent lost by even if he/she manages to find a new tenant that pays the higher rent. Even if it the place gets rented out immediately after you move out, which it probably won't, there are agency fees, painting and other maintainance to take into account.

    So do not accept straight away, and you might be surprised by the results.

    Good luck!


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