'Cases are one-offs' - Galdes downplays tenants losing deposits before moving in

Reports of would-be tenants losing deposits for properties they never move into are “one-offs”, Housing Minister Roderick Galdes said, as developers argue that landlords are “regularly exposed to irresponsible behaviour by tenants”.

On Monday, Times of Malta reported the experiences of renters who said they had lost hundreds of euros in deposits for properties they did not end up moving to.

The tenants’ union Solidarjetà said that to prevent such issues and other forms of abuse, deposits should be held by a neutral third party.

But on Monday afternoon, Housing Minister Galdes dismissed the proposal, saying that overall, landlords as well as tenants obey the rules.

“We have tried, as much as possible, not to interfere with the market and when we drafted the (rental) regulations, we did so knowing that we trust landlords as well as tenants", he said.

“This [reported abuse] is not something that is happening en masse. I am informed that cases where people try to abuse are one-offs,” the minister said.

One tenant told Times of Malta he paid €1,100 for a Gżira flat – covering the deposit, rent and agency fee – but after paying the money was told the flat was no longer available, and did not receive a refund.

Another said he had arrived at the property he had paid a deposit for only to find it occupied, while another said the landlord threw his belongings into the street following a dispute about the provision of bed sheets and towels.

Galdes said such cases were an issue for the police and not the housing authority. Otherwise, someone can seek legal advice, he said.

He said issues where would-be tenants lost deposits happened at times when “a lease would not have begun”.

“If someone was scamming someone else, that is an issue for the police. They can then proceed with court action immediately because there has been fraud,” Galdes said.

'Tenants are often opportunistic'- MDA

The housing minister’s comments Monday came as the Malta Development Association (MDA) said it “strongly objects” to the reports.

The MDA, which also represents landlords, said in a statement Tuesday that such claims ignore “systemic issues” faced by landlords and “mischaracterise the legitimate use” of deposits.

The MDA said it “strongly objects to the one-sided portrayal of landlords” it claimed were present in the article, stressing deposits were “not a hidden trap or exploitative tactic" but a standard practice locally and internationally.

The lobby said that “contrary to the narrative presented” in the article, landlords are “regularly exposed to irresponsible and opportunistic behaviour by tenants or prospective tenants”.

Such behaviour, it said, includes tenants changing their mind after paying a deposit due to “frivolous reasons, gossip, or personal circumstances”, terminating a rental agreement early – which the MDA noted is allowed by law – and, when leaving properties, “often leaving behind damage, unpaid utility bills, or rent arrears” while not providing a forwarding address.

“These are not rare occurrences... Any discussion of tenant protections must equally consider the risks borne by landlords, who often operate in good faith and with no comparable avenues for redress,” the lobby said.

Responding to a suggestion by tenants’ union Solidarjetà for the government to set up a deposit holding system, where deposit payments would be held in escrow, the MDA said such a system “would risk bureaucratising or paralysing an already sensitive and time-critical process”, calling pre-contract arrangements “often fluid and informal”.

The lobby said tenant protections should be “reinforced but not at the expense of fairness or at the cost of demonising landlords”, the “vast majority” of whom act professionally.

It called on all stakeholders, including the media and Solidarjetà, to “engage in constructive dialogue and avoid generalisations that harm the sector’s reputation”.

The MDA said the cases reported by Times of Malta, “while unfortunate, reveal a lack of documentation, legal clarity, or engagement with licensed intermediaries such as real estate agents”.

The reported lack of a signed lease, formal deposit agreement or oversight by an estate agent “undermines the credibility of the claims”, it said. “The solution is not to vilify landlords, but to encourage all parties to formalise pre-contractual steps”.

Tenants often do not pay rent or bills-SME Chamber

On Sunday, MaltaToday reported that tenants are often the victims of exploitative practices.

The outlet said landlords often refuse to refund deposits and charge illegal fees, “treating them as disposable ATM machines”.

In a reaction, the Chamber of SMEs, which also represents a number of landlords, said landlords and tenants usually have a cordial relationship.

“In reality, the mutual relationship between the majority of landlords and tenants is very good, and this is evident with Housing Authority data which shows the vast majority of contracts being renewed is on the increase year on year.”

The chamber said landlords are often left with unpaid rents and utility bills.

“A recent survey conducted by the SME Chamber among its landlord members revealed that 50.38% of tenants leave properties with unpaid bills, whether related to utilities or other obligations.”

It said it was finalising a “comprehensive position paper with a number of recommendations for a fairer and more equitable legal framework between landlords and tenants”.

“We firmly believe that any form of abuse, whether by landlords or tenants, should be addressed through appropriate and effective legal mechanisms, with clear consequences in place for any wrongdoing,” the chamber said.