John Consiglio’s epistle advocating a tough policy with owners of rented property highlighted many abuses of the system, which I join him in condemning and I agree that they should be addressed. However, by his yardstick, all owners of rented accommodation must be treated as guilty since all must swallow the bitter medicine.
Believe it or not, there are genuine Maltese owners of rented accommodation who have always paid their full dues to society. Successive governments over the last 70 years have thanked them by imposing requisition and rent control, obliging them to accept tenants at rents that are a fraction of the fair market rent. That’s one way to stretch your social housing budget but certainly not fair and equitable.
Well, here we are, eight years after legislation was passed to end many of these legislative injustices, albeit very slowly, over the lifespan of a generation with security of tenure and, in some cases, their children’s lifespan too.
We now have a chorus proclaiming the horrors of high rents. I have no sympathy for rents that may amount to usury but I am for annual rental values based on a fair percentage of market value, giving a reasonable rate of return on capital. Certainly, income tax should be paid on this rental income. There is a clear need for social housing but not at the expense of a group of individual owners. This is a burden that must be shared by all.
The same legislation was meant to bring commercial rents to a fair market value within four years. As from January 1, 2014, when owners and tenants cannot agree on rental value, this was supposed to be based on a ‘property market value index’ to be established by the minister concerned. This index has never been published, leaving owners with the unpalatable option of spending many years in court or waiting to 2028.
Perhaps the minister should consider the substantial increase in government revenue that could be generated through income tax on realistic rents as well as eliminating unfair competition from shops with heavily-subsidised rents.