Fresh law to stabilise rental sector mooted
A law to regulate the relationship between landlords and tenants and promote stability in the rental sector is in the offing. The Ministry of Housing has drafted the Landlord and Tenant Bill which is intended to simplify, modernise and consolidate laws relating to renting of commercial and residential premises.
Currently there is no rent control in Kenya except for units with monthly rent of Sh2,500 and below as stipulated in the Rent Restriction Act (Cap. 296 of 1981). The draft has however been stuck at the Attorney General's office for more than a year now despite being cleared by the Cabinet for tabling in Parliament, according to Housing minister Soita Shitanda. “The law will clearly stipulate the rights of tenants and landlords. It was cleared by the cabinet long ago but the AG has failed to act on it,” said Shitanda on Wednesday.
The law when enacted will among other things protect tenants from 'unlawful' rent increases and unlawful evictions; balance responsibilities of landlords and tenants; and provide for the adjudication of disputes and related incidents. “Currently, landlords and tenants agree freely on rents, but the new law will require that landlords give a three-month prior notice in writing and advance reasons for rent hikes,” said Shitanda.
Conditions under which a landlord may increase rent will include: having carried out specified capital expenditure in exchange for the rent increase; pledging to provide new or additional services; or adjusting rent taking into account inflationary trends in the economy. A Landlord and Tenants Authority will be established to handle disputes such as arbitrary rent increases, effectively replacing the current Rent Restrictions Tribunal. “Its existence will safeguard initial tenancy agreements. We will not determine rents but once parties are in agreement, the authority will step in to solve disputes,” said Shitanda.
Prior to residential occupancy, a tenant signs an agreement with the landlord or agent and pays a month's rent and equal amount for deposit. The deposit is refunded if property is returned in 'same' condition. Real estate agents representing landlords will in such cases be answerable for landlords as there exists no law regulating them. At present, anyone can become a property agent as there are no stipulated terms, according to Shitanda. “We are also working on a draft law to regulate registration of agents and provide guidelines on how they should operate,” he said.