The Housing Observatory presented MPs on the committee with data and graphics obtained as a result of a broad consultation on rental legislation. Among the observations was the fact that rent prices have risen at a faster pace and more significantly than the price index, particularly since the 2000s.
MP Meris Šehović of The Greens (déi gréng) said much time had been lost without improving the legislation. The presentation revealed nothing he didn’t already know, and he said it was a shame that tenants, in the weakest position in the housing market, did not benefit from more protection.
MP David Wagner of The Left (déi Lénk) agreed that a rent cap would be an important step to take prior to the next parliamentary elections.
Housing minister Claude Meisch presented an initial proposal at Thursday’s meeting, suggesting a differentiation be made between older and newer properties. For new properties, where the investment is substantial, a formula should be developed to determine how high the rent may be in relation to the invested capital. For older homes, a cadastre should be used.
However, the Alternative Democratic Reform Party (ADR) disliked the idea of such a system, explained party leader Alexandra Schoos. It would be better to stick to the law as it is at the moment – i.e. with 5% of the invested capital as a price cap for the rent – and see that this is also implemented.
Due to data protection, a cadastre would not be an option, she said, adding that a rental commission should oversee the application of the law.
The ministry also envisages such a commission at the national level, primarily to strengthen tenants’ rights, the minister added. This would also ensure transparency.
For a concrete change to the law, however, the necessary data must first be collected, said MP Paulette Lenert of the Luxembourg Socialist Workers’ Party (LSAP). She regrets that only the displayed rental price from real estate advertisements is always used for data reports.
As a result, only new rental prices are necessarily taken into account, because existing contracts are not reflected in them. Only with figures that correspond to reality could the law be properly adapted, Lenert said.
MP Alex Donnersbach of the Christian Social People’s Party (CSV), however, commented that a system must be found that protects tenants on the one hand, but does not hinder investment in rental housing on the other. Tenants would not be helped if there were no more rental housing.
The discussion on the proposal proposed by the Minister of Housing will continue next week.
