The Malta Independent 17 November 2018, Saturday

Estate agency head highlights need for one-bedroom accommodation in city centres

Kevin Schembri Orland Wednesday, 7 November 2018, 09:19 Last update: about 10 days ago

There is a need for one-bedroom apartment in city centres, Co-Founder and CEO of Quicklets and Zanzi Homes Steve Mercieca told the Malta Independent.

He was speaking after a conference organised by Fenech and Fenech on property law, held at the Chamber of commerce in Valletta.

Mercieca explained that they receive around 90 inquiries each day for one-bedroom apartments, out of 118 inquiries. “There is a hunger for such apartments and current policies do not allow for the construction of blocks of one-bedroom apartments in city centres, in employment hubs. I think that this needs to be revisited and re-discussed. People are comfortable living in smaller apartment. I can understand that there are habitation issues and so on and I agree with them, however oversees in city centres, people go for such apartments.”

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“I also want to comment on service departments and co-living areas. There is no policy in place for co-living areas. We need to discuss this and see if we can come up with schemes for co living housing opportunities.”

 He said that this was not mentioned in the recent white paper.

During the conference it was highlighted that foreign workers tend to come to Malta for a few years before moving to a different country. This would seem to back Mercieca’s proposal.

Managing Partner of Fenech & Fenech Ann Fenech, opened the conference by stating that property has always been a main pillar of Malta’s economy.

Karl Micallef, a lawyer with her firm, delivered a presentation on Malta’s rent laws throughout the ages, and highlighted that past laws created constitutional issues, and some breached the EU convention of Human Rights.

He highlighted that laws were introduced during the world war periods due to major social housing issues, and that these laws were in favour of tenants.

In 1959, an Ordinance was introduced, and was originally meant to be beneficial to both owners and tenants, “however was eventually turned on its head and owners lost all their rights, and effectively lost possession of their property.”

In 1995, there was a fundamental shift in the property business, and government liberalised the property market, he said.

Legal amendments in 1999 were a major step in phasing out the older laws, and in 2009 the right of succession with regards to leases was further limited.

He highlighted case law regarding the right to enjoy property, and how judgements at the European court of Human rights regarding old rent laws locally found them to be in breach.

A panel discussion took place involving Mercieca, Malta Developers Association President Sandro Chetcuti and Chamber of Commerce council member Reginald Fava ( who also represented a number of organisations over the years however stressed that his views in this discussion were in his personal capacity).

During the debate, Fava said that in the past, when there was a crisis, government legislated according to the necessities of the country. He said that today “we are trying to fix the issues to those who own property and could not enjoy it.” He said that today Malta went from one extreme to another, saying everyone is trying to take as much as possible because they see an opportunity. “ Can someone guarantee us that the opportunities will remain?... Apartments are being built, people are coming here to work, yet we are kicking them out. We need them, they come to work and we kick them out. Why?  As they cannot afford the rents everyone is asking for. “

He highlighted the need for regulation.

Fava said that Malta needs to take action to protect the vulnerable. He said that the market has to be regulated. “Currently, under present conditions when there is no social housing available – there are over 3,000 on the waiting list  - then I think the market has to be regulated in an honest way, by looking at everyone’s interests. I do not believe we should subsidise government in social housing but I believe we should contribute and help under certain circumstances, and the present circumstances warrant that certain regulations be put in place.”

Asked by this newsroom whether he has any proposals in this regard he said he has, but is not yet willing to make them public. He has, however, passed on the document to the authorities to consider on behalf of organisations he is involved in. “I understand that it is a sore subject, and that politicians tried to steer clear of in the past. Both sides of the House do wish for a convergence on certain things which need to be done.” They will be made public when they are approved he said.

Sandro Chetcuti suggested that government create incentives for land owners to build affordable housing. He slammed the older laws, arguing that governments should not have interfered in the market so much.

He said that he agreed that agreements made between tenants and landlords be registered and honoured. “It cannot be that after two years someone drops the agreement if it was signed for a longer period.” 

Describing the recent white paper, he said it seems very well-balanced.  He said that the MDA wants to go for an incentives option, and that government should not interfere in the market. “Providing the right incentives to direct people to create affordable rent accommodation is the way forward.”

He said that landlords will accommodate vulnerable tenants if there is the right scheme in place. Asked what incentives he had in mind, he said that the MDA is trying to persuade government to allow land lords who rent long-term for a affordable price through possible initiatives would, in the long run, benefit from capital gains reduction.

Fava, however countered and said that in normal circumstances, no government should interfere in the operation of business. When there is no choice, like today, then government should, he said.

Two years ago I was part of a delegation to the Prime Minister, and said that the benefits being created in the country were not reaching those at the bottom. The Prime Minister asked me what I would suggest, and I told him to raise the minimum wage.

He said that people are coming to Malta, people we need, professionals, who had to leave as they could not afford the rent prices requested. We will face a major problem 

Turning to the white paper, he said that the new white paper analyses well the present situation. “But there are no solutions.”

“There are no solutions to today’s problem. Why? As I believe the authorities want us to intelligently present the solutions ourselves. That is what I wish.

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