Falling house prices in Bermuda mean the threshold for properties which come under rent control is to be reduced.

Homes with an annual rental value of $27,000 or less are regulated by the Rent Commission to give tenants in lower-value properties security of tenure and prevent landlords from increasing rent arbitrarily and unfairly.

The threshold is to be lowered to $22,800, but the number of properties which come under the commission is not expected to change because thousands of homeowners had the value of their homes drop between the end of 2009 and July 2014.

A Bermuda Government spokeswoman said the change was being made on the basis of information provided by the Department of Land Valuation from its 2015 draft valuation list.

“The 2015 draft valuation list reflects the analysis of rental information returned to the Land Valuation Department,” she said.

“The draft list confirms the widely held opinion of many in the property sector, and in the community, that rental values, in general, in the open market have fallen between the valuation date of December 31, 2009, for the previous 2009 valuation list and July 1, 2014, which is the valuation date for the valuation units in the current 2015 draft valuation list.

“A tenancy of a premise is subject to rent control if the ARV is $27,000 or less, as determined by the 2009 land valuation list. This threshold placed 17,060 rental units under rent control.

“Now that the Department of Land Valuation has finalised the new valuation list, which takes effect [retroactively] from January 1, 2016, the new list has lowered ARVs, which will require an adjustment to rent control’s threshold.

“The effect of the new valuation list will place approximately 3,215 more residential properties under rent control if the current threshold of $27,000 is not adjusted ... The lowering of the threshold to $22,800 will keep the number of valuation units under rent control relatively unchanged [17,061].”

The 2015 draft valuation list can be inspected at post offices, the Land Valuation Department and online at www.landvaluation.bm