The government's proposals for rent reform were positive, but more needed to be done to ensure the market left no one behind, 20 NGOs said on Saturday.

The new White Paper published on Monday proposes mandatory minimum leases as one possible means of tackling the instability and uncertainty of six-month leases, the other being financial incentives for contracts longer than a year.

Rent reform: minimum lease periods but no fixed prices

Calling the current rent situation a “jungle,” Moviment Graffitti’s Andre Callus said the situation could not simply be resolved by the White Paper.

While applauding the fact that many of their recommendations had been taken on board, the NGOs are insisting on a minimum contract period of three years and tax incentives connected to contract length.

A landlord providing a lease for seven years would then pay less tax on rental income than a landlord providing lease of four years, the NGOs said.

They called for tenants with existing lease agreements to be protected, warning landlords might ask for an exorbitant increase in rent prices or terminate existing agreements when the reform comes into effect.

Tenants reporting landowners for not providing a contract should be guaranteed at least a three-year lease at a favourable rate, they added.

“Tenants might not report irregularities for fear they might be kicked out,” Mr Callus said.

The NGOs agreed with the White Paper saying housing supply should not depend on the private sector. However, they insisted the government should steer clear of Public Private Partnerships since they have no particular benefits.

Instead, housing should be provided by the state and non-profit setups to build affordable housing.

“We need to take into account the fact that basic essentials, such as milk prices, are on the rise,” Yana Mintoff said.

She said in one month alone, she had met six families that had to leave their lodging because rent prices had skyrocketed.

Other recommendations by the NGOs:
1. Maximum rent increases should be set according to the cost-of-living increase, not the Property Price Index as proposed in the White Paper;
2. The creation of a Rent Value Index, which would list rent-value in different areas and different types of property;
3. Sanctions deterring landlords from renting without a valid contract;
4. Once a contract expires, the price set in a new contract should not be higher than 10 per cent of the last monthly rent paid under the previous contract;

The recommendations were endorsed by 20 NGOs, including Moviment Graffitti, Alleanza Kontra l-Faqar, Malta Tenant Support and SOS Malta.

 

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