Lease and let live?

By Gihan Shahine

Samia and her husband Ahmed have already piled their furniture in the street in front of the building where they once lived. The landlord of their rented apartment in Al-Darrassa has managed to obtain an eviction order. According to Samia's lawyer, the couple were paying LE7 a month; the landlord wanted to sell the apartment for thousands.

Two young children, who lived with their grandmother in a rented apartment after the death of their parents, are currently facing a possible eviction order. Their grandmother, the original tenant, and their only source of financial support, has died.

Mamdouh Riad, a veteran lawyer, says his office receives at least 15 lawsuits a month filed by tenants or landlords. Abdel-Aziz Sabri, a legal counsellor and the recently retired head of the rent department at the Supreme Court of Appeals, estimates that the court sees 40 to 50 cases a day involving rented apartments.

Almost all housing and legal experts agree that the relationship between landlords and tenants has deteriorated because the housing laws governing apartments rented decades ago have not been updated.

"Some rented apartments are still subject to an old, rather obsolete law which dates back to Nasser's era," Riad says. In order to provide low-income families with affordable housing, President Gamal Abdel-Nasser froze rent and entitled second and third generations to stay permanently in flats leased by their parents or grandparents. "For these apartments, rent status has never changed; the result is that tenants and landlords have got into fierce battles," Riad adds.

Landlords, in effect, are dissatisfied with the rent situation. Many are trying by every possible means to evict their tenants. Hassan Abdel-Razeq, an 86-year-old retired official at the Ministry of Education and the owner of an apartment building in Maadi, complains that the rent his tenants pay does not even cover his medical expenses. "I make a total of LE30 a month from the whole building, and I pay LE150 for my medication," says Abdel-Razeq. "It is unfair that people pay a few pounds to stay in a big apartment in a classy district when the owner cannot even cover his own expenses."

Some landlords even resort to illegal tricks to get their apartments back. In a lawsuit that Riad is handling, the owner of an apartment building in Shubra, which brings in a total of LE56 a month in rent, allegedly blew up a butane bottle in his own basement to obtain a permit to tear down the building. According to Riad, he had been offered LE2 million to sell the land.

Tenants, on the other hand, are never ready to leave "their" homes: where would they go? A full-blown housing crisis is pinching lower-income groups hard, and the gap between salaries and flat prices continues to increase. Second and third generations of tenants stay on in their parents' rented residences, probably unable to afford an alternative.

Tension, however, has increased since the Supreme Constitutional Court proclaimed that bequeathing a rented apartment beyond the first generation of descendants is unconstitutional. That is, only the parents, spouse and children of an original tenant are entitled to stay in a leased apartment after his or her death.

Legally, the court's ruling has nullified an important part of the law, and many eviction cases are now being presented in court, since the Ministry of Housing has yet to draft alternative legislation. The decree has fueled public concern and the media is engaged in a heated debate over rent status.

"We're panicking: are we going to find ourselves in the street?" Amal wonders. "The Ministry of Housing has to consider possible amendments before we, and thousands of other people, are made homeless."

Urban planning expert Milad Hanna believes that the current dilemma is the outcome of a delay in the amendment of current housing laws. Hanna says he called for a change for rent status twenty years ago, but his calls seem to have fallen on deaf ears. "Now it is becoming even more difficult to solve housing and financial problems," he says.

One result, Hanna adds, is that "the executive authority has left space for the judiciary to take action in order to settle disputes. There are cases in real life that sometimes contradict constitutional concepts. And the question now is whether the Constitutional Court's ruling will be applied retroactively. What about third-generation tenants who have been living in rented apartments for 15 years or more and have no other alternative?"

Recently, a decree was passed stipulating that future Constitutional Court rulings should not be applied retroactively. Rulings passed before this decree was issued, however, such as those concerning rent laws, will continue to have retroactive effect. The problems of many second- and third-generation tenants, therefore, will not be solved.

Hanna deplores the consistent delays in the drafting of laws. "Look at the situation now: rich people stay in their apartments or close them for future use, and pay only meagre rents. Courts are flooded with lawsuits. Neither tenants nor landlords care about maintenance, and many apartment blocks are in terrible disrepair. The poorer segments of society, on the other hand, unable to cope with rent laws, have created shantytowns outside the scope of legal authority. The Ministry of Housing cannot solve the problem single-handedly; a decision should be made at the highest levels," he argues.

Minister of Housing Mohamed Ibrahim Soliman asserts that the ministry is studying a new draft law, to be discussed in the coming Parliament session, and is adamantly opposed to the eviction of tenants still paying "old" rent rates. According to a ministry spokesman, the minister has asked the media to tap public opinion for suggestions before drafting a law. "The ministry wants to reach a compromise to satisfy apartment owners without harming tenants, which needs both time and effort to accomplish," says Magdeddin Ibrahim, head of the housing department at the ministry. "The draft will then be presented to political parties, the People's Assembly and finally the Cabinet for approval. The law will definitely take low-income families into consideration."

Both tenants and landlords, ultimately, agree that rents must increase. Yet the criteria governing the increase are still hotly debated.

Some argue that third-generation tenants should not remain in leased apartments, since, according to their interpretation of Islamic doctrine, rent contracts may not be bequeathed and rent values must not be fixed. Others, however, believe this is not the time to make any changes in the housing law.

Veteran lawyer Galal Ragab believes that the rent status of old apartment blocks needs serious reconsideration. Yet he maintains that this is not the right time for any change in that respect, considering the economic and social problems most Egyptians are currently facing.

Zaki Hawass, a consultant to the Ministry of Housing, on the other hand, is one of those in favour of change. "It is absolutely unfair for landlords to receive rents ranging from LE3 to LE15 on large apartments, some of which may be located in upper-class areas. What the landlord receives is equal to, and sometimes even less than, the salary of a door-man," he says.

Hawass believes that rent on old apartments should be increased according to the date on which a contract was signed. He suggests that the increase take place gradually, so as not to burden tenants with unexpected expenses; that is, he suggests rent be raised by 10 per cent every year, over a period of five years.

Sherif Kamel, retired chairman of the Urban Planning Authority and a member of the ministry's housing committee, agrees. He believes, however, that the government should not interfere in defining rent values. "The increase in rent should occur gradually, until we reach a point when landlords are given the freedom to set rent together with tenants," Kamel says. "Many landlords are just fed up. A landlord once came to the ministry and asked officials to take his apartment block and give him a monthly salary instead!"

Kamel believes that rent contracts should not be bequeathed and that the system should change gradually, as was the case with agricultural land.

"The government, however, should offer an alternative to tenants. Subsidised housing projects for young people could be one way out," Kamel says.

Mohamed Hamed El-Gamal, former president of the State Council (an administrative court), believes a new law should be drafted in democratic conditions. The media, political parties, syndicates, and processional unions, he argues, should participate in discussions of the draft law. The law should also be discussed fully in Parliament, he adds.

"I believe a new law should maintain the tenants' right to stay in their rented apartments, especially given the current housing problem," El-Gamal asserts. "And increases in rent must take people's income into account. The government should bear part of the financial burden a change in the rent law would incur. That is, the government should either make salary and pension adjustments in accordance with increases in rent, or it should simply exempt landlords from taxes as an alternative to raising rents."

What about the tenants who may be soon forced out of their homes after the ruling of the Supreme Constitutional Court? They are still waiting for an answer.