Housing Authority revising rent subsidy schemes

The Housing Authority is currently revising its rent subsidy schemes in line with the rent reform, Social Policy Minister John Dalli said today. He did not give more details, but stressed that only people who really needed the Authority's help should be eligible to these schemes.

Mr Dalli was speaking at a press conference following the passage through Parliament of the Rent Reform Bill.

The minister thanked the Opposition for its contribution to the debate and said he was confident that the new legislation had struck a balance between the need for justice for landlords and the needs of tenants.

The new law comes into force on January 1. It also applies to government rented properties and tenants living in government rented properties.

Among other provisions, the new law establishes a minimum rent and gradually stops the inheritance of rented properties so that they may revert to their owners. The law applies to pre-1995 rents.

"I think the process of consultation was sincere and objective. We listened to constituted bodies, owners and tenants. There's no doubt that it was a much awaited and necessary reform aimed at stopping social injustice. I feel we've managed to be just with landlords, who could not enjoy their property, and we have given tenants enough time to adjust," Mr Dalli said.

The minister said that several changes were made since the White Paper was launched for consultation a year ago.

He pointed out that when a contract existed between an owner and tenant the contract would remain valid even if it was pre-1995. The new law only interfered in cases that were regulated by the previous law.

According to the reform, as from January 1, the minimum rent of a residence will be of €185 a year that will increase every three years according to the inflation index. No price will be imposed if there is an agreement in writing between the landlord and tenant. As from next year, rental agreements will only be valid in writing.

The right to continue the lease after the death of the sitting tenant will be a one-time right for the tenant's child if he lived there for four to five years before June 1, 2008 and continues to live there until the tenant's death. The lease can also go to a sibling, aged over 45, under the same conditions.

If the child is under five year old she or he must have lived in the rented property until the tenant's death. In cases where there is more than one child or siblings, until the tenants death, they have a right to continue the lease "in solidum".

People will not be eligible to the right to continue lease if they fail to meet the means test or beneficiary criteria. They will however be provided with transitory protection for three to five years.

As for commercial property, rent will from next year increase by a fixed rate of 15%. The 15% shall increase on the 1st of June of each year up till 31st December 2013 unless there is a different written agreement.

An information booklet on the reform was also launched.

www.rentreform.gov.mt