Minister of Finance Yair Lapid and Minister of Justice Tzipi Livni today presented a draft fair rent bill initiated by Lapid that was approved by the housing cabinet.
The purpose of the bill is to regulate lessor-renter relations in residential housing, and create a legal framework to ensure fairness and justice between the parties. The bill forbids raising rent by more than 2% annually. The basic rent will be determined freely by the lessor and the renter, and the lessor will be entitled to let his apartment for a year and then replace the tenant, but the rent for the new renter cannot be raised by more than 2%. In order to ensure that the renter knows what the price of the property was, the lessor will be obligated to show the previous tenant's lease to the current one, and to attach the previous lease to the new one. Violation of the duty not to raise the rent will require compensation even without proof of damage.
The bill will apply to new leases signed between January 1, 2015 and January 1, 2020.
In addition, the bill addresses lessor-renter relations, including guarantees, repairs of defects in the leased property, and regulation of housing insurance. The lessor will not be entitled to require the renter to pay insurance fees.
The bill defines housing suitable for rental in order to guarantee minimum housing quality, and prevent occurrences like the renting of parts of apartments lacking windows and kitchens. The bill establishes minimum conditions for residential housing, including a minimum space of 26 sq.m., free access to the housing, a supply of drinking water and hot water, electricity and lighting, ventilation openings, etc.
Lapid said that the proposed bill would create stability and fairness in the housing market. "With its help, we can provide renters with certainty about the price of their housing for a period of over one year. We can make sure that rental housing is fit for living in, and guarantee that the landlord won't impose unreasonable demands on the tenants just because he can - because he is sure that if the tenants do not agree, there are five more tenants standing in line."
Livni added, "From now on, housing owners will not own the tenant. From now on, the landlord will be obligated to provide a proper kitchen, proper bathroom facilities, and a reasonable area. The landlord can no longer obtain ownership of the tenant."
National Union of Israeli Students chairman Gilad Arditi said, "The vast majority of students and young people in Israel rent apartments, and are subject to the vicissitudes of an unsupervised and unfair market. Student surveys that we conduct yearly indicate that the students' main burden is the cost of housing, which is greater than tuition. The bill will balance the currently harmful relations between lessors and renters, and provide standards for rental housing."
Published by Globes [online], Israel business news - www.globes-online.com - on November 20, 2014
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