Source: Hong Kong Government special administrative region
The Government today (October 3) published the Basic Housing Units Ordinance in the Gazette. The Ordinance will come into effect on March 1, 2026, except for the provisions concerning the offence of illegal letting of subdivided units (SDU), which will come into effect on March 1, 2027.
The Ordinance seeks to introduce, starting from March 1, 2026, a regulatory regime for the letting of SDUs in residential buildings (i.e. the regulatory regime on Basic Housing Units (BHU), under which SDUs in residential buildings have to comply with a set of minimum standards of living conditions (including minimum area, minimum height, fire safety, structural safety, separate toilet, water supply requirements, lighting and ventilation, as well as separate water and electricity meters) and obtain BHU recognition before they can be legally let out for habitation. This aims to ensure the provision of safe, hygienic and reasonable living conditions in SDUs.
The BHU regulatory regime will provide a 48-month transitional arrangement to allow time for SDU owners/operators to understand the new regulatory regime and gradually adapt to the BHU-related requirements. To this end, the Government will, on the effective date of the Ordinance, launch a 12-month registration system (i.e. until February 28, 2027) for existing SDUs to make registration and then obtain a 36-month grace period that runs after the expiry of the registration period (i.e. from March 1, 2027, to February 28, 2030) to enable necessary alteration works to be carried out and applications for BHU recognition to be made. The registration eligibility is pegged to the date of publication of the Ordinance in the Gazette today (gazettal date). In this connection, if the residential flat with SDUs has at least one valid domestic tenancy of an SDU on the gazettal date (i.e. October 3, 2025) or during the three-month period ending on the gazettal date, that SDU and other SDUs in the same residential flat will be regarded as “pre-existing SDUs” and may be registered as mentioned above to obtain the grace period. To encourage SDU owners/operators to submit registration and recognition applications as early as possible, the Government will provide “early-bird” reductions/waivers on recognition fees, i.e. application fees will be fully waived for SDUs with early registration/application (note).
Under the BHU regulatory regime, an SDU refers to the situation where a residential flat in domestic buildings or the domestic portion of composite buildings, through partition/repartition, has changed its layout compared to the one shown in the reference building plan and resulted in two or more compartments designed for separate domestic tenancies. In other words, if an individual residential flat has not been altered compared to the reference building plan, letting out the rooms in that residential flat for habitation will not fall within the scope of the regulation of the Ordinance. Moreover, in respect of private residential flats, the “reference building plan” generally refers to the relevant approved building plan for the issuance of the Occupation Permit (OP) by the Buildings Department (BD); and if the relevant residential flat has any building works certified as completed by BD to change the layout of the flat after obtaining the OP and before the gazettal date, the relevant approved building plan will be regarded as the “reference building plan”, whichever is later.
Given that there are currently about 110 000 SDUs in residential buildings in Hong Kong, involving about 220 000 residents, the Government will adopt a pragmatic and people-oriented approach and take into account the future supply of BHUs and public housing, when taking orderly enforcement actions against the illegal letting of unregistered and unrecognised SDUs after the expiry of the registration period (i.e. starting from March 1, 2027). With the implementation of the BHU regulatory regime, the government understands that some SDU households may be affected by the need for relevant owners/operators to arrange alteration works for obtaining BHU recognition, or by the future enforcement actions to be carried out by the Government, rendering them unable to identify other suitable accommodation within a short period of time. If the households concerned are eligible to apply for Light Public Housing or transitional housing (TH), the projects that are currently in operation and coming on stream can provide them with sufficient accommodation options. The government also understands that some households may not fulfil the relevant application requirements, e.g. income/asset exceeding the limits. In this connection, the Government has announced earlier that a new type of Category C tenants for TH will be created starting from today, to provide temporary accommodation to those who are affected by alteration works or enforcement actions under the BHU regulatory regime in the future and have imminent rehousing needs. For information on the application for TH, please visit the Housing Bureau’s website www.hb.gov.hk/eng/policy/housing/policy/transitional/tenantapplications.html.
Before the Ordinance comes into effect on March 1, 2026, the Government will carry out various publicity activities in due course, including launching a thematic website, maintaining continued and close liaison with stakeholders such as professional bodies and estate agents, arranging talks or seminars at the district level, distributing promotional materials, and broadcasting promotional videos, with the aim of helping SDU owners/operators, tenants and other stakeholders understand how to comply with the BHU regulatory regime through different channels.
Note:
The Government will reduce/waive fees for recognition applications during the first three years of the launch of the BHU regulatory regime (i.e. from March 1, 2026, to February 28, 2029). The specific arrangement is as follows:
(a) flats with registration applications made during the first six months of the registration period (i.e. from March 1 to August 31, 2026) will enjoy a full waiver for recognition application in the first three years (i.e. from March 1, 2026, to February 28, 2029) and will have to pay the full price ($3,000) starting from the fourth year (i.e. starting from March 1, 2029);
(b) flats with registration applications made during the last six months of the registration period (i.e. from September 1, 2026, to February 28, 2027) will enjoy a full waiver for recognition applications in the first two years (i.e. from March 1, 2026, to February 29, 2028), half price ($1,500) in the third year (i.e. from March 1, 2028, to February 28, 2029) and will have to pay full price ($3,000) starting from the fourth year (i.e. starting from March 1, 2029); and
(c) other recognition applications can enjoy a full waiver in the first year (i.e. from March 1, 2026, to February 28, 2027), half price ($1,500) from the second to the third year (i.e. from March 1, 2027, to February 28, 2028) and will have to pay full price ($3,000) starting from the fourth year (i.e. starting from March 1, 2029).