Rent Contract Bill to Help Tenants in Iran

EghtesadOnline: Iran’s Ministry of Roads and Urban Development is pursuing a change in the way home rent contracts are devised to curb skyrocketing rents and provide a helping hand to frustrated tenants that have faced extra pressure this year.

News ID: ۷۸۳۴۱۱

28 July 2018

According to the ministry’s deputy for housing and construction affairs, Hamed Mazaherian, recent developments in the housing market have changed the government’s priorities for the embattled sector that is now experiencing a short period of boom after five years of recession.

“One of the main priorities of the government in the housing sector is to support the rights of tenants. As we know, short-term contracts have proven harmful not just to the housing sector but to others as well, so we have proposed to increase the period of rent contracts to two years or more,” the official was quoted as saying by IRIB in a late-night television program.

Mazaherian said a plan has been submitted to the parliament as a bill to make tenants one of the stakeholders of the contract with some authority, Financial Tribune reported.

He explained that contracts with longer maturity periods of five years are not part of the proposal.

At present, rent contracts are usually signed with one-year maturity periods, mostly so that landlords can annually increase the rents.

This has created a myriad of problems for people renting homes since there is no official authority to handle sky-high increases by homeowners.

The MRUD last year warned that landlords are only allowed to increase their prices by 10%, but many tenants, especially those living in Tehran, witnessed much higher rates that went beyond 100% in some cases.

Mazaherian also conceded that rents have increased beyond the 10% threshold. But he pointed out that one part of the nine-point plan that was recently announced by MRUD is specifically aimed at supporting tenants and calls on landlords to cap their rent increases at 10% as part of the two-year contract.

He noted that such a plan had been considered before, but had no legal basis.

“Should this law gain the approval of parliament, the tenant will be able to make legal pursuits to regain their rights if the landlord demands higher rents, unless the tenant and the landlord have made an agreement stating otherwise,” Mazaherian said.