The reform of the rental lawapproved in the Chamber of Deputiesthe discussion begins this Tuesday, August 29 from 6:00 p.m. in a plenary session of commissions Legislation and Budget and Treasury. Prior to the plenary, the senators met with entities from the real estate sector, who affirm that it is “urgent” and “necessary” incorporate the modifications. In that context, contracts are currently on hold because the owners await the decision of the Upper House.
“The immediate adoption of these changes will contribute to normalize and balance the supply of rental housing units and, consequently, to the stabilization of the corresponding values”, the entities of the real estate sector indicated in a statement that they disseminated requesting the “urgent treatment of the project to modify the Rental Law“
Rents paralyzed by speculation
The real estate sector sees “positive” the reforms to the rental law that were made in the lower house, they even hope that the market will “stabilize” and the offer will be “reactivated”. In that context, alejandro benazzarpresident of the Argentine Real Estate Chamber (CIA)ratified that currently the owners “do not sign contracts” waiting to know if it is done with the new law or with the one that is in force.
Likewise, the head of the CIA confirmed that at 4:00 p.m., prior to the committee plenarythe entities of the real estate sector met with the senators.
For her part, the President of the Sole Association of Real Estate Brokers of the City of Buenos Aires (CUCICBA), Martha Liottoassured that the contracts that expire at this time “are extendedwhich is the tool that exists to keep those units rented.”
Reform of the rental law: What modifications does the project approved in Deputies propose?
Within the reform that was approved in Deputies, it is proposed that the contracts last 2 years, instead of three, and that the price updates are no longer annual, but “with the periodicity that the parties agree“though they should be”at intervals not less than 4 months”.
In turn, the approved project also introduces changes in the index that is taken for the adjustments, which, up to now, was the Lease Agreement (ICL). If the reform is approved in the Senate, Article 14, on adjustments, will be worded as follows:
“For the adjustments, the parties must agree on the mechanism for updating the rental price at the beginning of the rental relationship, being able to apply for such purposes the Consumer Price Index (CPI), Wholesale Price Index (WPI) and/or Wage Index (IS), prepared by the National Institute of Statistics and Censuses (INDEC) or a combination of said indices, according to the parties agree”.
Rental law reform: for the sector, “it would boost the market”
From the real estatewho are highly optimistic about this reform, pointed out that if the reform is approved in the Senate “it will automatically stabilizes market“, since the offer would be improved and they even highlighted that part of the rents that are in dollars, could “be offered again in pesos, with a quarterly adjustment.”
“Perhaps, if the reform is approved in the Senatethat may allow part of the offer is offered again in pesos with a quarterly adjustment according to inflation or an agreement between the parties,” said Andrés White, commercial manager of the Miranda Bosch real estate agency, in dialogue with this outlet.
Currently the rental market is short supply and “little demand”, since to a large extent the offer is in dollars and the parallel currency already increased 36.4% in the month of August.
“Regarding the market situation after the half penaltyalthough there was an upturn in queries, the reality is that it has not changed and we remain in the same scenario, which is of a almost absolute stoppage of operations. Precisely for this reason, it is essential that the Senate discuss and approve the bill as soon as possible. Project emanated from the Lower House”, stressed Liotto.
Poroteo in the Senate to approve the reform of the Rental Law
To approve the draft modification of the current standard in the Senateare needed 37 votes and Together for Changethe space that promoted the initiative, has 33 legislatorsso they will have to negotiate with four others to prevent the ruling partywho mostly rejected the reform, won the fight in the Upper House.
“What are the chances that the amendment will be approved in the Senate?” he wondered. German Gomez Picasso, founder of Real Estate Report. “Today the rental market is the same, nobody takes for granted that the law is going to be changed. I would even tell you that the perception is that everything will remain as it is and we will have to wait for another, a next government, to change the regulations. The situation remains the same, with very strong increases and less supply, “he replied to his own question.
And it is that his pessimism is based on the fact that the front of all (current Union for the Fatherland, since he did not change the name of his parliamentary bloc) is a majority in the High camera and is against the reform proposed by the opposition. That makes the chances, for now, seem limited.
Source: Ambito
