The country’s rental property market fell short of what befitted a modern European country, the Guardian of Future Generations said on Friday.
Maurice Mizzi noted that the rental property market was not balanced by an adequate stock of social housing units supported by the State.
He was reacting to the government’s White Paper on rent reform. Published last month, it proposed mandatory minimum leases as one possible means of tackling the instability and uncertainty of six-month leases. It also mentioned financial incentives for contracts longer than a year.
However, Mr Mizzi noted that rental reform under successive governments had done too little to attenuate the indiscriminate suffering both landlords and tenants alike had to endure.
He lambasted the “unacceptable procrastination to invest in social housing experienced over the last several years” saying this could have showed that the first signs of a potential housing crisis were already there.
Recent government initiatives were commendable but not enough, he noted, adding the White Paper on rent reform was long overdue.
He conceded that Malta was a nation of home-owners but “that did not mean the State should ignore the threats of a potential housing crisis”.
There were various factors that contributed to the crisis and the influx of migrant workers was “only one aspect of a far more complex story”, he commented.
Emerging trends, such as higher marriage breakdown rates, were leading people to seek alternative accommodation. “These persons are often in dire financial straits,” Mr Mizzi pointed out.
The country needed an adequate regulatory framework that addressed the domestic rental market in the light of today’s rapidly evolving realities, he added.
Mr Mizzi said a policy on direct capping of the initial rent rates would be counter-productive. “It does not mean, however, that subsequent rental increases on established agreements should be left entirely unregulated or allowed to happen sporadically,” he noted, adding that an adequate and fair mechanism was needed that primarily factored in tenants’ economic circumstances.
A new rents regulatory framework should enable the legislator to ensure both landlords and tenants treated each other with respect, each shouldering their respective responsibilities. “Legal provisions should be set that expedite the resolution of disputes that arise between rental parties and penalties prescribed accordingly,” he remarked.
Mr Mizzi criticised the one-year mandatory minimum contract period proposed in the White Paper, saying it would not serve to alleviate the anxieties of most tenants who would still be forced to juggle between one transient “home” and another.