Fair Rent Law – Proposed Legislation
Recent years have seen several attempts to incorporate a Fair Rent Law into the Israeli housing sector. The most recent attempt passed the Ministerial Legislation Committee in late July 2015. The proposed legislation will now be placed before the Knesset, and could become law before the end of 2015.
The main provisions of the proposal include:
Rent Registrar
Every landlord will have to register the terms of the rental contract with the Rent Registrar within one month of signing a lease. The Registry will be available for public scrutiny and will show the current lease as well as the property’s rental history. In this way, it is hoped that the public will be alerted to the going rate for such properties in a neighbourhood, and be less willing to agree to elevated rentals.
Exemption from Land Appreciation Tax (מס שבח) on sale
A landlord who does not raise rent on a property for three years will be entitled to certain exemptions from Land Appreciation Tax when the property is sold. This is designed to encourage landlords to keep rentals consistent over time.
Attempts in the past to legislate a Fair Rent Law were thwarted because of opposition to setting limits on free market rentals.