RANGOON — Rangoon Division parliamentarians plan to discuss how to curb skyrocketing rent rates in the commercial capital on Wednesday, a regional MP told The Irrawaddy.
During a session of the divisional parliament earlier this week, Thaung Kyaw from a Yankin Township constituency put forward the issue, urging the government to find a solution to rental prices that have soared in recent years. The lawmaker on Monday said many Rangoon residents were facing housing difficulties due to the booming real estate market, including a trend toward increasing numbers of poor residents being forced to illegally squat in some places.
Lawmakers have agreed to discuss the issue on Wednesday, according to Nyo Nyo Thin, a lawmaker from Bahan Township.
“Property rental prices in Rangoon are quite high. I will propose to form a committee to control such skyrocketing rents. I believe it will work,” Nyo Nyo Thin said.
She said she would propose that the committee, formed of regional MPs from each of Rangoon’s 33 townships, be tasked with capping rent rates on a township by township basis.
“MPs can supervise the price control committee. At the least, owners wouldn’t be allowed to hike rent rates within a six-month period for renters,” she said.
In Rangoon, the most common arrangement is for the landlord and tenant to enter into a lease agreement of six to 12 months, with the tenant required to fork over a half or sometimes full year of rent before being given the keys. Since economic and political reforms enacted by President Thein Sein, rent hikes on a six-month or annual basis have been common—and sometimes steep.
While increases of anywhere from 10 to 50 percent are typical, rent rises of up to 100 percent are not unheard of. Finding housing for anything less than 100,000 kyats (US$102), however, is essentially unheard of.
Realtors chalk the rising rental rates up to a supply shortage as foreign investors, NGOs and Burmese transplants from outside Rangoon have moved to the commercial capital to take advantage of the opportunities that reforms have brought. Speculative land owners have also been accused of unfairly hiking rates to take advantage of the situation.
Earlier this year, realtors told The Irrawaddy that in prime commercial areas, rental fees at the start of 2014 were at their highest ever, having more than doubled since 2012. The boom includes both commercial and residential rates, the latter seeing an especially sharp rise in high-end apartments and homes in townships downtown, as well as neighborhoods north of the city’s core.
Khine Maung Yee, a Union Parliament Lower House lawmaker, said the issue was not confined to Rangoon, and was also a concern in Mandalay.
“It should be a national issue, because many businessmen are investing in a lot of estate projects. If we want to ease property prices, we will have to make all-inclusive workshops here,” he said.
“We will have to discuss with experts, businessmen and all related sectors to find out how to control the rising prices, but we will have to set a target time for implementation,” Khine Maung Yee added.
“If we are going to control the prices, we will have to see who will be impacted. That’s why we need to have a workshop first.”
However, Moe Moe Aung, secretary of the Myanmar Real Estate Association, said several factors would conspire against the government’s ability to control rent rates in Rangoon.
“The major factor is, prices are on the lips of owners. If the government fixes the prices, they won’t rent their properties, so how can government control that?” she said.
“It’s not possible to cut the rental fees here—local and foreign renters will continue to face a lot of difficulties.”