Rent Control Battles Continue In India

Internationally, relatively few countries have retained rent controls as even progressive governments (England, France, Vietnam) have recognized that command-and-control rent regimes have extremely negative affects on housing production and maintenance.  A delayed progression of such events now appear to be unfolding in New Delhi.  The Union Cabinet of New Delhi has endorsed the Urban Development Ministry’s proposal to repeal the Delhi Rent Control Act (DRCA) of 1995.  Although such an action appeals heavily to tenants and renters, many New Delhi property owners are concerned that the fair legislation they have been fighting for will be further delayed.

The DRCA (1995) was introduced as a piece of legislation to amend the Act of 1958 by creating a balance between the various needs of both property owners and their renters.  The DRCA of 1958 provided tenants with protection from owners who might unlawfully evict them or charge them unreasonable rents.  The law may have served a purpose at the time, but has become painfully outdated and has been subject to abuse by tenants.  Rents have remained virtually frozen and property owners are forced to collect mere fractions of actual market values.  In New Delhi, owners must wait an unreasonable amount of time before they can regain control of their property to realize its full worth due to the ability of tenancies to be passed on by he deceased renters.  These laws have become a burden on many landlords.

With an implementation of the Delhi Rent Control Act of 1995, landlords could have recovered their properties more easily, but the Act was never notified after Parliament approval.  This was due to a large public protest staged by tenants and pressure put on legislators by pro-tenant groups.  the Cabinet has decided that it will try to create another bill that would hopefully appease both sides.  Repealing the DRCA (1995) is part of the process.  Many property owners feel that it will take years before fairer legislation is implemented, but they have not given up hope.  Of course, all of this is happening right before the 2014 Parliamentary elections.

 

Additional Links:

Cabinet nod to Repeal Act, New Law on the Anvil

Property Worth Crores, Rent Still in Hundreds

Owners Worried, No Clariety Yet on Focus of New Law

New Jersey Set to Extend Rent Controls to Senior Housing

By Tom De Poto/The Star-Ledger

Residents at the Woodbridge Hills development were behind a bill passed by the Legislature to protect seniors from rent hikes in towns with rent control laws. (Tom De Poto/The Star-Ledger)

 

Six years ago, the tenants at Woodbridge Hills, a gated rental community for people 55 and older in Woodbridge, were hit with a steep rent increase. At the same time, an incentive offering one rent-free month every year ended. In some instances, rents leaped by $2,400 to $2,600 a year.

Woodbridge Township, however, is one of about 100 New Jersey communities with rent control laws that cap increases, usually around 2.5 percent. When the end of the incentive and an 8.5 percent rent increase were combined, it amounted to nearly an 18 percent hike.

“We were unaware of a law that gave (the landlords) carte blanche to raise rents,” said Ed Gorman, a Woodbridge Hills resident and vice president of the tenant association. “We love the community and we love living here, but we couldn’t afford it.” Continue reading