The government has adopted a rent-control scheme that appears to give it four years to improve the prospects of people at the rock bottom of the housing ladder, or continue living with a shameful blot on a wealthy society. The scheme would give a measure of protection to nearly 100,000 households living in subdivided flats, often with health, fire and structural risks, while they languish up to 5.8 years on a public housing waiting list. But they would be exposed to uncontrolled rents after a maximum of four years. The government has adopted all the recommendations of a task force that led a study on tenancy control for the poorest renters. The proposed law includes fines of least HK$10,000 for landlords who overcharge for rent or utilities such as power, ties rent rises for subdivided flats to a market index and caps them at 15 per cent, and mandates a standard contract between landlord and tenant. It does not make anyone happy. Tenant activists believe rent rises should be fixed by a formula linked to the consumer price index. Agents and landlords claim violation of free-market principles and property rights. Fifteen per cent may seem too high to some in these Covid-19 times, but not to landlords who face their own cost pressures. Perceptions of the right balance depend on standpoint. The real issue is that the cap applies only to negotiation of a second two-year contract, with the tenant having priority over any other applicant. After four years, landlord and tenant would have to negotiate a new contract without a cap on the rent increase, leaving the tenant unprotected and at risk of having to find more rent or downsize even further. If there is no light at the end of the public housing tunnel by then, tenants may find themselves in a landlords’ market. That raises other questions. They include whether four years is long enough; whether the government really wants to regulate subdivided flats rather than eliminate them; and whether regulation might effectively legitimise this kind of remedy to the housing crisis. Given that the need for such a law at all reflects failed government housing and land-supply policies, legitimisation would place the consequences of the failure at the door of the most vulnerable. Regulation sends mixed messages, one being that subdivided flats may be there for some time. It is also a concern that this sort of regulation will encourage subdivided flats in the market. There needs to be a clear policy objective. It should be limited to buying time for the ultimate solution – a much greater supply of affordable, decent public housing for poor people. That adds to the urgency of finding enough land to meet the city’s housing needs. The government should review the effectiveness of the tenancy control law after two years when contracts are being renegotiated.