Czech Housing Association to propose changes to legislation to make long-term tenancies easier

by   CIJ News iDesk III
2022-12-01   09:35
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The Association of Rental Housing (ANB) plans to submit its own proposals for changes to legislation next year to make long-term rentals easier in the Czech Republic. Speaking at yesterday's Housing 2022 Roundtable in Prague, its representatives said that amendments to the Civil Code, the Notary Code, the Civil Procedure Code, the involvement of the arbitration court and the computerisation of the tenancy relationship are needed.

"You get the non-payers out most often in a year, so everyone prefers to enter into repeated contracts to get rid of the stowaway. We want to move on, to have a higher proportion of long-term lease contracts, protection of the paying tenant and the owner, The only way is through a change in legislation and we need predictability of instruments," said ANB Vice President Jan Rafaj, managing director of Heimstaden Czech, the largest private provider of rental housing in the Czech Republic.

The fundamental difference between long-term and short-term leases is that in the case of long-term leases, the landlord can give notice for reasons set out in the law. In a short-term lease, the parties are not legally restricted and are given more contractual freedom. The length of the lease does not play a role.

ANB commissioned a study by the law firm Havel & Partners. It shows that landlords are afraid to enter into long-term contracts because of the difficulty in enforcing termination notices. While in the United States, for example, it takes a few weeks to evict a defaulter, in the Czech Republic it can take up to 18 months.

The study has resulted in five legislative proposals that are most needed and politically, socially and economically acceptable. These are an amendment to the Civil Code, a notarial deed of execution, an amendment to the Civil Procedure Code, an arbitration court and the computerisation of the tenancy relationship. Based on ANB's mandate, the lawyers will prepare the proposals into a paragraphed text. "We would be very keen to take them to the relevant ministries in 2023 so that we can start discussions with them, as well as with industry representatives of tenants and other players in the housing market," Rafaj said.

In the Czech Republic, 21 percent of people live in rented accommodation and 79 percent own their own flat or house, according to Eurostat data. The average in the European Union is 70 percent own and 30 percent rent. In Germany and Austria, for example, half of households live in their own and rented housing. However, rental housing is becoming increasingly popular in the Czech Republic due to the rising prices of new housing, mortgages and inflation, which is reflected in rising rents. They rose 22.5 percent year-on-year in the third quarter, with the average offer price currently at CZK 393 per square metre, according to real estate server Flatzone.

ANB brings together two dozen owners of residential apartments in the Czech Republic, who own more than 60,000 rental apartments since 2020. The main objective of the association is to support the development of rental housing and to share the experience of its members with the professional and lay public.

Source: CTK