Parliament enacts rental law
Owners can reclaim their
properties from pre-1992 tenancy
The Parliament approved a long-awaited rental law on April 1st. The new law gives tenants, under the jurisdiction of the pre-1992 law, incentives to evacuate properties.
Joseph Zougheib, Chairman of the Association of Owners of Leased Property, said: “We believe this law is fair to both owners and tenants. It is freeing us since, eventually, we will have the choice of doing whatever we want with our own property.”
Pre-1992 tenants will be given four to six times the value of the 'fair' rent of the property they are occupying, as per an expert evaluation, if they decide to evacuate it without delay. This compensation gradually decreases with every passing year spent at the premises, until it reaches zero percent after nine years. “The more time tenants take to evacuate, the less the compensation they will get,” Zougheib said.
Meanwhile, the law allows property owners to raise gradually their leasing prices up to a five percent of the property’s value. “During the first year of the law enforcement, the tenant pays only 15 percent of the five percent, which is increased gradually every year until the five-percent ratio is reached,” he said. After nine years anyway, the owner has the right to evacuate the tenant for free.
A fund will be established to finance the rent of poor tenants. The tenants can only acquire the fund’s help if their income does not exceed at least two times minimum wage.
Tenants will also have priority to housing loans from the Public Housing Corporation, if they can meet the conditions of this institution.
The law relieves the property owner from some annual taxes as well. “Paying a large sum every year to the State while getting a very small return from the tenant was not fair,” said Zougheib.
Reported by Yassmine Alieh
Date Posted: Apr 01, 2014