Muscat calls for registration of rents, end to ‘entitlement mentality’

Joseph Muscat calls for end to entitlement mentality from mediatoday on Vimeo.

A proper regulation of the rental market is not about dictating prices but to provide a framework laying out the rights and obligations for landlords and tenants, Prime Minister Joseph Muscat said this evening.

“Every single rent must be registered and contracts must be signed, allowing both tenants and landlords rights and obligations under the law,” Muscat argued.

He went on to add that in analyzing and studying the proposal, the government must also think of how to address the increase in prices that such a regulation would definitely bring about.

Addressing a conference organized by the Labour party on the rental market, the Labour leader also said it was time to end “the entitlement mentality” which sees people who can afford their own property living in social housing.

“Social housing is for the poor and for those who cannot work… no one has the divine right for a property and priority should be given to those most in need until they can fend for themselves,” he said.

Arguing that his statement was definitely not “popular”, Muscat said that just because someone’s parent or grandparent benefitted from social housing doesn’t mean that his son or grandson should continue living there just because they’ve changed the address on their identity card.

“If you are in employment and can afford your own place, the social housing property should be given to those who really need it,” he said, to applause.

During his intervention, Muscat admitted to be concerned by those who are not ‘poor enough’ for social housing, but who are not rich enough to afford their own property.

“There is that group who would have never imagined that they would need the government’s support but who are today feeling that they are being squeezed out,” he said.

The government is set to announce a measure that would help first-time buyers in getting their first property by addressing the 10% deposit required by banks for the loan.

The panelists agreed that rent agreements should be covered by contracts

The measure was also supported by backbencher Silvio Schembri, who said that couples who were spending €600 a month in rent could easily use the same money to cover their loan.

Amongst the panelists was also economist Philip von Brockdorff. He argued that whilst the introduction of ceiling on property rent could sound like the ideal solution, foreign studies have shown that such a move actually led to an increase in rents in their totality. The ceiling, he argued, led to a reduction in property supply which in itself leads to increase in rents.

“Looking at Malta, I fail to understand how one can introduce a price ceiling and differentiate between one street and the other in Sliema,” he said.

Von Brockdorff urged the government to consider the possibility of forcing developers to play their part in social justice by giving back property at lower prices in return for upmarket developments.

“We’re currently experiencing a steady rhythm in the development of luxury apartments and it should be an obligation by the developer to dedicate a block for social housing or offer rents at lower rates than that demanded by the market,” he said, calling this move “a social obligation”.

The conference heard panelists calling for both short-term and long-term measures which would safeguard people who suddenly find themselves homeless. According to veteran social justice campaigner Charles Miceli, there were also families who were forced to move to Gozo because of cheaper rent prices.