Government has invited the Affirmative Repositioning movement to nominate some of its members to serve on rent control boards. The invitation was extended to the movement by the Minister of Industrialisation, Trade and SME Development, Immanuel Ngatjizeko recently. “I am hereby requesting your good office as a matter of urgency to nominate on or before 12 August 2016 members of the Affirmative Repositioning to serve on the rent boards to be established in the following regions: Khomas (Windhoek); Erongo (Swakopmund and Walvis Bay); Kavango East(Rundu) and Oshana Region (Oshakati),” said Ngatjizeko. Rent control, like all other government-mandated price controls, is a law placing a maximum price, or a “rent ceiling,” on what landlords may charge tenants. If it is to have any effect, the rent level must be set at a rate below that which would otherwise have prevailed.
The board members will serve a three-year term. Ngatjizeko said: “The Rent Ordinance is the appropriate legislation to regulate the rental market through the appointment of rent boards, which will assist with controlling rent payable in respect of leased dwellings and business premises and receive complaints with respect to leased dwellings in areas of jurisdiction of such boards. In the interim, rent boards should be operationalised while MTSSMED is in the process of drafting a comprehensive policy on rent of dwellings and business premises.” He said the Special Cabinet Committee on Land and Related Matters directed the industrialisation ministry to undertake a review of the Rent Ordinance, 1977 (Ordinance No.13 of 1977) to establish whether the Rent Ordinance, 1977 will effectively regulate the rental market in the country and consequently prevent exploitation of the tenants by landlords.
The ordinance is aimed at establishing rent boards within local authorities, controlling rent payable in respect of leased dwellings and prescribing punitive measures for non-compliance with the civil judgment of the rent board. Earlier this year, AR and Government agreed to operationalise the Rent Control Board. Both parties also agreed to speed up the implementation of the Rent Control Board, as set out in the Rent Ordinance 13/1977, which among other things will regulate rental prices as well as resolve any disagreements arising from rental contracts.
In a New York Times article written in 2000, well-renowned economist Paul Krugman explained at great length how rent controls were the best way to offer tenants higher rents and restricted choice. Capping rents, he wrote, would lead to “the absence of new apartment construction”, “bitter relations between tenants and landlords”, and “ever-more ingenious strategies to force tenants out”. Despite the calls for a rent control regime, economists on both sides of the divide continue to have divergent views with some reckoning that a restrictive price ceiling would reduce the supply of property on the market.