Malta’s Landlords Up In Arms And Warn They Will Stop Renting Properties Out Under Proposed Law
Landlords in Malta have voiced their fears about a proposed rent reform, with some warning they will withdraw their properties from the market entirely if the law goes through.
While the proposed law isn’t proposing direct government intervention in the rental market, it is imposing certain restrictions on landlords.
Notably, annual rent increases will be capped at 5%, all rental properties will have to be registered with the Housing Authority, and landlords will have to give tenants three months notice before evicting them.
And while rent prices have skyrocketed in recent years, several landlords feel that the market has started to stabilise and that a law shouldn’t be rushed through as a reaction to the price rises.
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Around 250 landlords attended a consultation meeting organised by the Malta Developers’ Association last night and a spokesperson for the MDA told Lovin Malta that the mood was one of significant concern.
“Some landlords said yesterday that they’ll be forced to remove their properties from the market if this law goes through and wait and see what happens,” he said, warning that such a situation will lead to rises in rent prices due to a dearth in supply.
He also warned that landlords remain scarred by the experience of 1979, when the government converted leases into permanent rental contracts.
“There’s some concern that this could be a repeat of the 1979 rent laws…some people are seeing some similarities and have become edgy.”
Many landlords are also concerned at the proposal which requires them to give tenants three months notice before evicting them or face seeing the contract automatically extended by the same duration. While this is intended to give evicted tenants enough time to search for a new place, some landlords are concerned that tenants could abuse the system by ignoring eviction notifications so as to renew their contract.
MDA President Sandro Chetcuti yesterday urged the government to take heed of landlords’ complaints and preserve the concept of freedom of contract in the new law.
He also urged the government to address the situation of rents entered into before 1995, when the government liberalised the rental market. A few months ago, the Constitutional Court declared that forcing landlords to rent properties below their market value is unconstitutional.
“On the subject of pre-1995 rent agreements that have now been identified to be unconstitutional and still leave some landlords majorly disadvantaged to this day,” Chetcuti said. “The general feeling is that the Housing Authority should not continue relying on private landlords to provide low-cost residential accommodation for tenants that are able to afford paying today’s rates like everyone else. Directly addressing this injustice is long overdue should be adequately catered for in the new law.”
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