Cairo: If the current market value of buildings is the benchmark, Al Houssini Salama should be a millionaire in his own right. The 68-year-old pensioner is the owner of a four-floor building in Cairo’s upmarket quarter of Heliopolis, which he inherited from his father. But this wealth is no cause for him to feel happy.
“Can you believe that the total monthly rent of this apartment block do not reach 100 [Egyptian] pounds [Dh20.8]?” he said.
“All the spacious apartments there are rented under an old lease law, which does not set a limit to the lease period or allow a rise in the rent value.”
Paradoxically, Salama said he himself is living with his wife in a nearby apartment in the same quarter for 6,000 Egyptian pounds per month under a different lease law issued in the 1990s.
“This is absurd. How can two laws on the same issue be in force? Where is justice?” he desperately asked.
Salama is one of tens of thousands of landlords in Egypt who are pushing for annulling the lease law, which dates back to the socialist era of late president Gamal Abdul Nasser, who ruled Egypt for 14 years from 1956.
Nearly 2.5 million apartments housing about 20 million people are estimated to be covered by this law.
Under former president Hosni Mubarak, who was forced to resign in a 2011 uprising, another law was issued in 1996 liberalising the rent value of new buildings and setting a limit to occupancy. The 1996 law did not replace the old one apparently for fear of causing social unrest in the country, which is suffering from a chronic housing shortage worsened by huge population growth.
“This is unfair and contradictory,” said Ahmad Mustafa, a lawyer for several owners of old buildings. “This injustice threatens an important part of Egypt’s real estate wealth. Most owners of old buildings neglect maintaining them because the revenues they get from their lease cannot buy even a kilo of beef,” Mustafa told Gulf News. “The paltry rents have tempted some of the tenants to close their apartments for their children to use when they grow up, while they have moved to new houses in compounds for which they have paid millions. This practice compounds the housing crisis.”
Tenants see the issue differently, though. “When I rented this apartment about 50 years ago, I paid the highest rent of the time,” said Mohram Fadl, a pensioner, who is living with his wife in the Cairo district of Hadayek Al Kouba. “The rent money I have paid since then equals the cost of its construction. So why do they want now to impose on me higher rent or evict me? Where should we go then?”
Successive parliaments shunned debating the issue due to its social repercussions.
However, several lawmakers in the incumbent legislature say they have presented draft bills to address it soon. One is MP Esmail Nasr Al Deen. “The law on old rents, which is still in force in Egypt, cannot be found anywhere else in the world. Therefore, it is necessary for the parliament to discuss it on the basis of not harming any side — the landlord or the tenant,” he told Gulf News.
He explained that his draft is based on gradually raising rents of old residential buildings to reach fair levels over 10 years.
Nasr Al Deen also proposed setting up the Housing Interdependence Fund, an initiative aimed at supporting tenants, who cannot afford the new rents based on their incomes.
“My draft law does not call for evicting a tenant from the house,” he said. “It is just aimed at returning balance between the two sides.”