Only half of vacant dwellings available for rent, says minister

Environment Minister George Pullicino told Parliament on Wednesday that only half the stock of vacant dwellings is available for floating on the rental market.

Speaking during the debate on second reading on the Bill proposing a reform of the rental laws, Mr Pullicino said Malta had a very high number of vacant dwellings - 27 per cent of all property available in 2005. But the figure was at variance with the result of the latest census.

Mr Pullicino quoted census figures showing 53,000 vacant dwellings, but this did not mean, he said, that these were up for sale or lease. It meant that these were simply uninhabitable. Vacant dwellings in 1995 had been 23 per cent, rising to 27.6 per cent in 2005 - an increase of more than four percentage points in 10 years.

Of the vacant dwellings, 20 per cent were summer residences, and 25 per cent were dilapidated and must be redeveloped. In reality, therefore, only half of the 27 per cent vacant dwellings were available on the market.

Vacant properties which were not on the market had been already addressed by the 1995 reform, and the present reform was intended to regularise rents of dwellings which were already leased.

He said the present reform was long overdue and it was one of the government's top priorities because of the justice element. Admittedly, post-war requisition legislation had been required at the time but the situation had changed, and what used to be a necessity 60 years ago no longer held water today.

It was impossible for the government to satisfy the aspirations of all stakeholders. But it had tried its best to address most of the problems with the least negative effects. It was not fair that tenants earning between €20,000 and €30,000 a year paid an annual rent that was less than the cost of a packet of cigarettes a day. Such situations had to be urgently addressed.

On the vacant dwellings, the potential of which the Bill sought to maximise, Mr Pullicino said the 1995 amendments had not left the intended effects because there was no consensus between government and opposition. Owners of vacant dwellings had remained apprehensive that a future Labour government would again change the rules of the game. Even the White Paper underlined owners' lack of confidence.

Again, he said, it had taken a Nationalist government to introduce the reform, and he appealed to the opposition for consensus. The developer wanted stability and continuity, and owners of vacant dwellings must feel that they could put their property on the rental market.

The Bill aimed to create a functional, socially-just and effective rent market. The greatest challenge was to address social injustices created by old legislation without creating new ones.

Nationalist MP Philip Mifsud said that the law had evolved into one of the biggest injustices, even though amendments had been enacted along the years. The turning point had been the 1995 reform, aimed at having empty dwellings floated back onto the rental market. But property owners were still sceptical.

He believed the rental market would benefit through this Bill, which was eagerly awaited by property owners, and even by those who were not involved but who believed in social justice.

Some tenants also believed that the Bill was also aimed at safeguarding their interests. Where they differed was on the details and not in principle.

The Bill sought to find a balance because the interests of the owner and the tenant were diametrically opposed; hence the transition period. Legislation enacted in the 1970s meant that owners subsidised the tenants. Now the owners had a guarantee that after a number of years they would see their properties back, even if the transition period might seem too long from their point of view.

Referring to the process of consultation, Mr Mifsud said that it was satisfying to note that even the Leader of the Opposition was in agreement as to how this had been conducted. More than 3,000 comments to the White Paper had been received but ultimately, it was the government that had to decide.

Concluding, Mr Mifsud said he was convinced that the government would continue to expand its social housing programme for those who could not afford higher rents.

Ċensu Galea (PN) welcomed the fact that the opposition intended to vote in favour of the Bill. This was important because in the past there had been many people who had expressed doubts that a change of government could result in measures which led to instability in the rent market. He also welcomed the opposition's statement on requisition orders.

Mr Galea said the rent market was being revived, adding that the government had to address the social housing issue towards those who were really in need. The government also supported needy families under various schemes managed by the Housing Authority. The Bill specified the number of years required for the leaseholder's family members to enjoy the right to the inheritance of the lease.

The amount of requisitioned property, which had stood at 25,000 in 1995, had dwindled to less than 2,000 last year.

The Bill also sought to address the sub-letting issue, with justice done to the owners. The 1995 regulations with regard to contractual ties could be implemented under the new Bill.

The debate continues.