Saturday 20th Jul 2024
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Housing

AEG Proposes the Govt to Reduce Rent of Hiyaa Flats

Commoner’s Friendship Association, or AEG, has submitted multiple proposals to the Government regarding the Hiyaa flats.
The Housing Development Corporation had decided that the rent of the Hiyaa flats would be MVR 7500 per month, with an additional MVR 1000 charged monthly as a maintenance fee. As such, the total rent paid for the Hiyaa flats per month would be set at MVR 8500.
In response to this decision, the Commoners Friendship Association compiled a report which takes multiple factors into consideration regarding the rent for the Hiyaa flats; and includes multiple proposals or recommendations for the government.

Rent set by the previous administration

The Association stated that the previous administration had agreed to a rate of USD 62,000 or MVR 956,040 per unit for the construction of the Hiyaa flats. The Association also noted that according to figures revealed by the previous administration, expenditure for the completion of the structural work was 6,692,280,00; while 8,695,926,351 was estimated for finishing works; and 26,769,120 was estimated for project management.
Taking these figures into consideration, the cost of each flat is estimated at MVR 1.3 million. As such, the Association’s report notes that the administration of President Yaameen Abdul Gayyoom had decided on a down payment of MVR 25,000 for each flat, after which the rent would be MVR 6,600 – with MVR 5,600 as rent and MVR 1000 as maintenance fee – for a repayment period of 20 years.

Changes brought by the current administration

While the incumbent government did not bring any changes to the construction cost, the Association noted that the government had amended the management cost from MVR 26 million to MVR 267 million, while also increasing the marketing and refinancing cost. The Association cited the incumbent government’s policies as the reason for this and stated that the cost increased due to the delay in completion of the project as well as changes to the credit rating of HDC.
The Association’s report also noted that the price of the flats increased because the government – instead of taking responsibility for these increased costs and expenditures – has saddled the public with the burden.

Solution

The Association also observed that at a time such as this, when the people are experiencing financial difficulties, it is the responsibility of the government to work with the public and find a solution for this issue, and as such, outlined some recommendations for the same.
For instance, the Association proposes that the rent be lowered to MVR 6000 for a period of eight months either with or without a down payment. The Association further noted that this reduction in rent for eight months would cost the government MVR 90 million, which should not be an impossible amount, seeing as the state budget has allocated MVR 170 for officials visits and travel alone.
The second recommendation proposed by the Association is that the monthly rent be maintained at an amount no greater than MVR 5000 after the eight initial months and that the maintenance fee be reduced from MVR 1000 to MVR 500. The Association also suggested that responsibility for the maintenance of the Hiyaa flats be borne by a club comprised of flat owners, which would include a representative of the HDC.
The Association further requested that the water bill for the flats be reduced, as this was discussed by the former administration. However, the Association stated that they are unaware of whether the current administration had carried out similar discussions.