At long last – The Common Expenses Curse

November 19th 2019

Here we are dear readers, a long awaited review of the statutory tenancy laws (it refers to buildings which were completed prior end 12/2009). The new proposal is expected to be voted by the House on 22.11.2019, subject to changes which might be introduced prior to this. So the proposal is not a final one.

The proposal suggests that non-paying statutory tenants can be evicted within 1 month for the residential units and for the other within 3 months from the landlord’s application. This is quite correct since property owners may be in debt or base their income (wholly or partly) on the rental income. A recent BBC report suggested that tenants in the U.K. who do not pay landlords, lead to desperation of the landlords with many of them having to lose their homes in foreclosures, since they cannot meet their obligations. A live report which is very touching we must admit. Although the U.K. has no statutory tenancies, the legal procedures in that country take a considerable time with the various legal tricks used by tenants to avoid/delay payments.

Having studied at a first glance the proposal, we suggest that in addition to the non- payment of the rent, a cause for eviction should also be:

  • The non-payment of the common expenses based on the administrative committee’s proof.
  • Any damage caused by the tenant and or its alternative use without a permit by the landlord should also be a cause for eviction.
  • In case that the tenant does not pay, the landlord to be able to place a memo on the tenant’s property (if any) blocking the sale/transactions for his own property (as well as those of his guarantors). At the same time any income that the tenant receives from the Government, e.g. social security, pensions etc to be so reduced against the rental level (USA law).
  • A damage caused, to be so assessed by the Technical Chamber of Commerce, within one month from submitting a landlord’s claim etc.

We believe that we live in a capitalist system (be it is more of a mix between the capitalist system and a communist ideology) and the prevailing situation interferes and disrupt the real estate market. The situation that exists today encourages the non-paying tenants, who, over the years of delay in legal/court decisions, frustrate the landlords, who more often than not forgo the delayed rents, which could run into thousands, so that they get rid of the bad tenant.

This state of affairs has discouraged landlords to let out their properties with the end result is the scarcity of units to let, which at the end it resulted in the increase of rents which over the recent couple of years have increased by 30%-40% (residential units), the disappear of blocks of apartments in addition. Since there are provisions for subsidized rents by the Government for the needy, to an extent, weak financially tenants are assisted.

There are many other provisions which require discussion, such as the subject of insurance/rebuilding of one’s property, the proposed set up of a Council which might undertake to repair commonly owned properties (where this Council is going to find the money, or who is to lend it, is another matter) and so on.

It is a good start dear readers and having the okay expected on 22.11.2019, it will be all for the best (we must comment on the unreasonableness of the communist party objecting to this proposal on the subject, but, then, it is their ideology).

We wish to add here that what is more important than the rental level, is the ability of the tenant to pay. Bearing in mind the more higher rental the landlord requires the higher the risk of non-payment. Make sure that lease agreements for one year or less, require 4 witnesses (2 for each party), whereas we find it necessary to include in a lease agreement guarantors (usually the wife of the tenant) giving details e.g. ID number, full address etc.

We will come back to you after the Bill is voted.

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