GMA signs rent control law

President Arroyo has signed without much fanfare a new rent control law.

The STAR got yesterday a copy of Republic Act 9161 or the Rental Reforms Act of 2002, which Mrs. Arroyo was said to have signed "shortly before midnight at her residence" last Dec. 22.

The new rent control law takes effect on New Year’s Day and will be in effect until Dec. 31, 2004.

Rent control was first passed into law by the defunct Batasang Pambansa in the late 1970s and subsequent acts of Congress later extended its effectivity and gradually increased the amount of rent covered based on the rising standard of living in the country.

Under the law, the monthly rentals in residential units in Metro Manila and other highly urbanized cities, not exceeding P7,500 and P4,000 in other areas, shall not be increased by more than 10 percent yearly.

Violators will be fined not less than P5,000 but not more than P15,000, or face imprisonment of not less than one month and one day to not more than six months, or both.

Under the law, lessors may enter into "rent-to-own agreement" with the lessee in which the lessee may acquire ownership of the residential unit.

The law also bans lessors from evicting lessees on the ground that the leased premises would be sold or mortgaged to a third person, regardless whether the lease or mortgage is registered.

The four grounds for evicting a lessee under the law are:

• Assignment of lease or subleasing of residential units in whole or in part, including the acceptance of boarders or bedspacers without written consent of the owner/lessor.

• Arrears in payment of rent for a total of three months with proviso conditions.

• Legitimate need of the owner/lessor to repossess his or her property for his or her own use or for the use of any immediate family member as a residential unit with proviso conditions.

• Need of the lessor to make necessary repairs of the leased premises which is one subject of an existing order to make the said premises safe and habitable with proviso conditions.

• Expiration of the period of the lease contract.

Under the law, the Housing and Urban Development Council (HUDCC) was given the task of conducting an information drive on the new rent control law in coordination with the concerned government agencies.

The HUDCC was also mandated to formulate within six months from the effectivity of RA 9161 a transition program that would provide safety measures to "cushion the impact of a free rental market."

Earlier, Mrs. Arroyo, who believes that government regulation of house rentals runs counter to the country’s free market system, allowed the bill to be certified as urgent to speed up its passage before Congress took a Christmas recess.

RA 9161 was the second law passed by the present Congress, after the Anti-Money Laundering Law last Sept. 29. – Marichu Villanueva