Property-ownership complications and low public awareness have slowed landlords’ registration of Hong Kong subdivided flats under new housing regulations, industry observers have said, after the government received only 42.5 per cent of the applications expected in the first phase.

Monday marked the deadline for the initial six-month “early bird” registration phase under the Basic Housing Unit Ordinance. Landlords who applied during this period were eligible for a waiver of HK$3,000 (US$382) in certification fees per subdivided flat for each of the first three years.

The legislation came into force in March to phase out substandard subdivided flats. The government estimates that about 80,000 flats across the city could be accredited, but only about 34,000 units were registered during the first six months.

Scott Leung Man-kwong, deputy chairman of the Legislative Council’s housing panel, described the 42.5 per cent application rate as acceptable but said the HK$3,000 discount was not a significant incentive for landlords to apply early.

“For inherited properties, sometimes the verification of legal ownership could delay the application,” he told a radio show on Tuesday.

“We’ve seen cases where a son inherited a flat from his father that is already subdivided. The tenants continued to pay rent and they did not process the legal transfer of the property. But now, with the application for basic housing units, they will have to do so.”