The opportunity given to tenants to withdraw from a rental contract with the possibility of getting their deposit back by giving sufficient notice, voids the concept of a long-term contract and a security deposit, the Estate Agents Section of the Malta Developers’ Association said.

Commenting on the proposed rent laws, the section said such a concept will introduce uncertainty for landlords and give tenants the possibility to rent for the summer and exit the contract in winter without losing their deposit.

This option, it said, should only be available in specific, unavoidable circumstances.

Moreover, the terms of a contract should be respected in full and an opt-out period could only lead to abuse by tenants.

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“Landlords will have worked hard to save and invest in an asset to be able to provide accommodation for tenants. This law will put pressure on their bank loan repayments,” a spokesman from the EAS said.

Giving tenants a possibility to easily withdraw from a contract would result in landlords feeling reluctant to enter contracts for longer leases. 

This it said, will lead investors to stop investing in the market and lower quality units will start to appear. 

Some landlords have already claimed they will leave their properties empty under such conditions, the section said.

It also referred to proposals covering room rentals and said the proposals being made created more problems than it solved.  

It said it fully supported stricter regulations, enforcement and inspections of rental properties but felt the Bill was giving the Housing Authority and its officials unlimited powers, including the right to enter any property, a right that was not even enjoyed by the police.

Inspections had to be carried out to ensure adequate living conditions and to avoid overcrowding, however, a basic warrant-driven process should also be introduced to reduce abuse of power.

The registration of all contracts, including current ones, was a strong point of the Bill but the role of estate agents was completely left out, the section noted.

It said it would remain in favour of a Bill to strengthen the rental industry, however, felt that the current version fell short of safeguarding the sustainability of the market as well as the interest of the landlords.