Officials have brushed off concerns that landlords might be hesitant about getting their dwellings declared as basic housing units under the planned new regulatory regime for subdivided flats, saying they would not consider extending a registration period.

The administration on Monday also suggested the possibility of establishing a reporting mechanism on homes breaching such rules.

According to the government proposal, landlords will be given 12 months to register their properties before having three years to make necessary improvements to be certified.

"I don't see why owners would not register if they intend to continue to operate," Deputy Financial Secretary Michael Wong told lawmakers when asked if registration numbers are low.

"We're not going to extend the [registration] period... The consequence of not registering is serious."

To be certified as a basic housing unit, owners must hire a building professional who checks if the flat meets a set of prescribed requirements.

A fee is also payable to the government.

Secretary for Housing Winnie Ho said the administration is considering charging landlords by residential units and that officials will study suggestions that fees should be based on home sizes.

She also addressed worries from lawmakers that some landlords might not comply with the regulations and operate subpar homes.

"The design of the [basic housing unit] regime comes with a very sufficient grace period and registration period," Ho said.

"Our requirements are very pragmatic... These are all doable.

"We may need a reporting mechanism to catch the most serious cases."

The government is hoping to introduce a bill on regulating the compact homes in the latter half of this year.