Real Estate News "Makes NO sense": Senate's maneuver to delay the changes to law - La Nación Propiedades

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"Makes NO sense": Senate's maneuver to delay the changes to law - La Nación Propiedades


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“No tiene sentido”: la maniobra del Senado para retrasar los cambios a la ley de alquileres y las repercusiones del sector

Los especialistas del sector advierten que las demoras en el tratamiento podrían frenar el mercado

www.lanacion.com.ar

August 30, 2023
Mercedes Soriano

Another misstep for the rental law . This Tuesday the senators met in a plenary session of commissions to discuss how to continue with the treatment of the rental law, after last week the Chamber of Deputies gave half a sanction to the modification project , promoted by Together for Change. But the disagreement of the ruling party put sticks in the wheel and made it difficult for the project to advance.​

Despite the fact that in most of the presentations of this day "speed" was requested to deal with the subject, today's resolution was to retrace its steps and repeat a process that was already carried out last year when for two months the representatives and chambers of owners, tenants and real estate agents met with commissions of legislators and even with the Minister of Territorial Development and Habitat at that time -Jorge Ferraresi- to express their positions and work on the changes to the law. But the changes have not yet arrived.​

“The Frente de Todos did not have the necessary majority to impose an opinion, so they said that they did not agree with the text of the half sanction, that they had the same position as the deputies who voted against and proposed to open the debate next Thursday : that owners, tenants and real estate chambers be invited and based on their testimonies to draft an opinion to reform the half penalty with a greater consensus ”, sums up Lorena Zapata, director of Esfera Pública. But the same was done last year.​

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“ It doesn't make sense to go back to this circuit of consultations that was done last year because there is nothing new to discuss, nothing has improved but it has worsened. Especially because the project that was approved in the House of Representatives is almost identical to the one that had a minority opinion, which, in turn, was the result of the work of that commission that brought together a lot of people", highlights Federico González Rouco, an economist specializing in housing and author of the book Owners or Tenants .​

That the law is not compatible with the market is nothing new. For years, real estate representatives have pointed out that it destroyed the offer, a fact validated by the withdrawal of apartments for rent and the consequent rise in prices for those that did remain available. That is why, just as the legislators requested, the voices of the sector call for a rapid change.​

“You can't keep going around the issue, especially with the half penalty already underway. All they are going to end up doing is slowing down the market even more.This process cannot last months, it would have to last weeks at most. That is why I think that it was a good sign that the Senate has discussed it in less than a week, but now it seems that it will be slow, "says González Rouco.​

Times in this case are of vital importance. “Speed is important because while waiting for the final sanction, many of the contracts that expire are extended , which is the tool that exists for these units to remain rented because, otherwise, it is highly probable that the owners would decide to remove them. from the market until there is greater certainty , ”says Marta Liotto, president of the Sole College of Real Estate Brokers of the city of Buenos Aires (Cucicba). Before the end of the year, more than 120,000 contracts expire , an offer that increasingly turns to temporary rentals, illegal contracts, is left empty or is put up for sale.​

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What are the next steps?​

"Open the debate and summon civil society actors," Zapata replies. In parallel, he says that the senators are going to work on drafting their opinions. "The Frente de Todos is going to present one with modifications to the half sanction and very likely Together for Change will insist on the half sanction as it is," he predicts, and clarifies that then the votes have to be pooled and whoever achieves the most the opinion of the majority is carried.​

Then, the opinions must be dealt with in sessions. First, the majority is voted and, if a majority of the votes are achieved, it is sanctioned and passed to the Executive Power to be published in the Official Gazette and promulgated as law. In the event that the majority does not get a sufficient number of votes -as happened in the Chamber of Deputies- the minority opinion is voted on.​

It should be noted that if an opinion wins that has modifications to what was proposed by the Chamber of Deputies -for example, if the Senators wins the proposal of the Frente de Todos- it returns to the lower house to be dealt with again. But if one wins without modifications to what Deputies already gave half a sanction, as for now proposed by Together for Change, it is law.​

“The truth is that Together for Change today it was not able to gather the votes for it to be ruled because Federal Unity and the other blocks in the media did not support it , they also want the debate to be opened and to analyze modifications; with which it remains to be seen what will happen but they would not have the chance to win”, analyzes Zapata.​

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In addition, the Frente de Todos spoke of comprehensively analyzing the housing crisis as a whole. "For this reason, they proposed that tomorrow at noon the debate on the half-sanction of UVA credits begin and on Thursday they are going to propose in a plenary session of the General Legislation and Tourism commissions that they begin to analyze a bill to regulate temporary rentals ”, indicated Zapata in dialogue with LA NACION.​

What does the bill say and what does the opposition want to change?​

In short, the project that last week obtained a half-approval in the Deputies seeks to modify mainly three points of the norm that today governs the market, which in turn are considered the most controversial:​

That the term of the contracts be reduced from three to two years.​

That the values of the current contracts be adjusted at least every four months.​

That the amounts are no longer updated based on the Rental Contracts Index prepared by the Central Bank - which combines the Consumer Price Index (CPI) and wages based on the average taxable remuneration of stable workers in equal parts ( RIPTE)- if they do not become linked to the index freely agreed upon by the parties to choose between the Consumer Price Index (IPC), the Wholesale Price Index (IPM) and/or the Wage Index (IS), prepared by the Institute National Statistics and Census (INDEC) or a combination of these indices.​

"The modifications that were included in the text are part of what our institution and the rest of the entities in the sector have been indicating that they were the necessary changes to begin to travel the path of a definitive solution to the current housing crisis, ending with the suffering that tenants and owners experience today”, said Marta Liotto.​

For its part, in both meetings the ruling party voted against these modifications . The senators of the Frente de Todos seek that the term of the contracts be maintained at three years, that the periodicity of updating the value of the contracts be at least every six months instead of four and that the indexation of the amount that the tenant pays monthly be based on a more limited menu of indices. In addition, various exhibitors raised the desire to incorporate tax benefits for owners in order to encourage the offer of rentals.​

Other changes proposed by the project with the approval of Deputies are:​

The permitting of advance payments , currently prohibited by current law but used in practice in contracts outside the norm.​

Tax benefits such as exemptions to the monotax, to the payment of the Personal Assets Tax on rented homes and changes in credits and debits in savings accounts or bank checking accounts used exclusively for operations related to the rental of a home.​

That the owner's failure to register the contract with the AFIP is not penalized with the sanctions of Law 11,683, although it remains uncertain what the legal sanction is, and other issues related to this obligation to register the contracts.​

Now, the opinions that the senators elaborate will be based on the project that has the half sanction of Deputies. “The senators who are the authors of the bills will most likely postulate the ideas they put forward as modifications to the half sanction, which can be completely modified. They are going to focus on the three key items that were marked as having the greatest disagreement on the part of the Frente de Todos: duration of the contract, minimum adjustment time and index”, explains Zapata.




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