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Rentals. Reasons why rental law changes in law don't advance - La Nación
Source:
www.lanacion.com.ar
September 16, 2023
By: Mercedes Soriano
The ruling party's proposal proposes that the contracts last three years and be adjusted semiannually based on an index that until now had not been evaluated for rental contracts.
In the Senate commission, two opinions were approved to modify the rental law: the majority is the new proposal for changes from the Frente de Todos and the minority is the project already approved by Deputies of Together for Change
After three weeks of debate, the senators signed two opinions to modify the Rental Law in a plenary session of commissions, which will soon go to the Senate to be discussed. The proposal that obtained the most signatures was the official one, which proposes a long list of modifications to the project already approved by the Chamber of Deputies.
The opposition remained firm and supported without asking for changes the proposal that has the support of the Chamber of Deputies, a ruling that obtained the fewest signatures. In short, this proposes:
The opposition achieved the minority opinion, which proposes maintaining the modifications approved by the Chamber of Deputies
The ruling party, for its part, presented a new proposal for an opinion (the one that had been presented in Deputies in August did not achieve approval) that achieved the majority of signatures and that incorporates modifications to the project coming from the Lower House.
The senators took into account the presentations made by real estate chambers and tenant federations to outline the changes that each party believes are necessary to recover the market. The main points that this new opinion seeks to modify are:
1. That the duration of the lease contracts be three years as established by the current law, and not two years as the project approved by Deputies says.
2 . That the rental price be updated at least every six months under agreement between the parties , instead of quarterly updates as proposed by the minority opinion supported by the opposition.
3. That the value of the contracts be necessarily adjusted based on the Casa Propia coefficient . This would replace the current Lease Contract Index (ICL) (which combines the variation in salaries and inflation in equal parts) and rejects the proposal approved by Deputies, which proposes that the index be freely agreed between the parties, which can be the aforementioned CPI, IPM or IS, prepared by the National Institute of Statistics and Censuses (INDEC) or a combination of said indices.
The Casa Propia index is used to update the installments for the loans of the Casa Propia and Procrear II housing programs . “This coefficient takes into account the lowest indicator between the average salary variation of the last year and the average inflation of the same period . Furthermore, by recognizing that the increase in salaries may vary depending on the branch of activity, it incorporates the Salary Variation Coefficient with a capacity of 0.9″, details the website of the Ministry of Territorial Development and Habitat, the entity that publishes the same.
“Using this coefficient adds a layer of complexity to the problem because in the short term no one is going to understand how much the contract is going to increase. The ICL runs behind inflation because it is two months behind in its calculation, but if this is an average of the last 12 months, it will be much further behind. Making this decision is showing that they did not understand what is happening ,” says Federico González Rouco, an economist specializing in housing. It should be noted that the variation in salaries lags behind inflation, so the average salary would always be used, the owners would lose even more profitability and the supply could deteriorate even further.
The ruling party's proposed ruling managed to collect the largest number of signatures
4 . Eliminates the possibility that owners can ask months in advance.
5. Maintains the obligation to register contracts with the AFIP as indicated by the current law, not with the changes proposed by the project approved by Deputies.
6. Adds that rental advertisements must be made in national currency (pesos), in a context in which the majority of advertisements are already published in dollars.
The project also proposes to modify the definition of urgent repairs determined by the proposal signed by Deputies, it incorporates an article referring to the Income Tax that says that "the parties may deduct from the Income Tax the sum equivalent to 10% of the annual amount of lease contracts” and adds to the tax incentives that “the income coming exclusively from the lease of two properties will be exempt from paying monotax .”
Likewise, it leaves some articles unchanged so that they remain as they were approved in the Lower House. Among them is that related to Personal Property, tax on debits and credits and the final provisions.
The ruling party's proposal proposes that the contracts last three years and be adjusted semiannually
For now there is nothing but uncertainty about when it could be treated on site . When consulted about this issue, Daniel Bensusán (FdT La Pampa), president of the General Legislation Commission, indicated that he hopes it will be addressed as soon as possible . In the same session, the draft regulation of temporary rentals for tourist purposes that was approved on September 1 in another plenary session of commissions will also be discussed .
Mercedes Soriano
www.buysellba.com
Source:
Alquileres. Las razones por las que no avanzan los cambios en la ley anunciados con bombos y platillos
La propuesta del oficialismo propone que los contratos duren tres años y se ajusten de manera semestral a partir de un índice que hasta ahora no se había evaluado para los contratos de locación
www.lanacion.com.ar
September 16, 2023
By: Mercedes Soriano
The ruling party's proposal proposes that the contracts last three years and be adjusted semiannually based on an index that until now had not been evaluated for rental contracts.
In the Senate commission, two opinions were approved to modify the rental law: the majority is the new proposal for changes from the Frente de Todos and the minority is the project already approved by Deputies of Together for Change
What you have to know
- The proposal that obtained the most signatures was that of the ruling party, which proposes more modifications to the project approved by the Chamber of Deputies.
- According to this opinion, the duration of the rental contracts would increase to 3 years and the rental price would be updated every six months under agreement between the parties.
- The index for updating contracts would be necessarily adjusted based on the Casa Propia coefficient.
After three weeks of debate, the senators signed two opinions to modify the Rental Law in a plenary session of commissions, which will soon go to the Senate to be discussed. The proposal that obtained the most signatures was the official one, which proposes a long list of modifications to the project already approved by the Chamber of Deputies.
The opposition remained firm and supported without asking for changes the proposal that has the support of the Chamber of Deputies, a ruling that obtained the fewest signatures. In short, this proposes:
- That the term of the contracts be reduced from three to two years.
- That the values of current contracts be adjusted with a minimum of four months and not one year as is currently the case.
- That the amounts are no longer updated based on the Rental Contract Index prepared by the Central Bank - which combines in equal parts the Consumer Price Index (CPI) and salaries based on the average taxable remuneration of stable workers ( RIPTE)- if not they become linked to the index freely agreed upon by the parties to choose between the Consumer Price Index (CPI), the Wholesale Price Index (WPI) and/or the Wage Index (IS), prepared by the Institute National Statistics and Censuses (INDEC) or a combination of said indices.
The opposition achieved the minority opinion, which proposes maintaining the modifications approved by the Chamber of Deputies
The ruling party, for its part, presented a new proposal for an opinion (the one that had been presented in Deputies in August did not achieve approval) that achieved the majority of signatures and that incorporates modifications to the project coming from the Lower House.
The senators took into account the presentations made by real estate chambers and tenant federations to outline the changes that each party believes are necessary to recover the market. The main points that this new opinion seeks to modify are:
1. That the duration of the lease contracts be three years as established by the current law, and not two years as the project approved by Deputies says.
2 . That the rental price be updated at least every six months under agreement between the parties , instead of quarterly updates as proposed by the minority opinion supported by the opposition.
3. That the value of the contracts be necessarily adjusted based on the Casa Propia coefficient . This would replace the current Lease Contract Index (ICL) (which combines the variation in salaries and inflation in equal parts) and rejects the proposal approved by Deputies, which proposes that the index be freely agreed between the parties, which can be the aforementioned CPI, IPM or IS, prepared by the National Institute of Statistics and Censuses (INDEC) or a combination of said indices.
What is the new coefficient they propose for the adjustments about?
The Casa Propia index is used to update the installments for the loans of the Casa Propia and Procrear II housing programs . “This coefficient takes into account the lowest indicator between the average salary variation of the last year and the average inflation of the same period . Furthermore, by recognizing that the increase in salaries may vary depending on the branch of activity, it incorporates the Salary Variation Coefficient with a capacity of 0.9″, details the website of the Ministry of Territorial Development and Habitat, the entity that publishes the same.
“Using this coefficient adds a layer of complexity to the problem because in the short term no one is going to understand how much the contract is going to increase. The ICL runs behind inflation because it is two months behind in its calculation, but if this is an average of the last 12 months, it will be much further behind. Making this decision is showing that they did not understand what is happening ,” says Federico González Rouco, an economist specializing in housing. It should be noted that the variation in salaries lags behind inflation, so the average salary would always be used, the owners would lose even more profitability and the supply could deteriorate even further.
The ruling party's proposed ruling managed to collect the largest number of signatures
4 . Eliminates the possibility that owners can ask months in advance.
5. Maintains the obligation to register contracts with the AFIP as indicated by the current law, not with the changes proposed by the project approved by Deputies.
6. Adds that rental advertisements must be made in national currency (pesos), in a context in which the majority of advertisements are already published in dollars.
The project also proposes to modify the definition of urgent repairs determined by the proposal signed by Deputies, it incorporates an article referring to the Income Tax that says that "the parties may deduct from the Income Tax the sum equivalent to 10% of the annual amount of lease contracts” and adds to the tax incentives that “the income coming exclusively from the lease of two properties will be exempt from paying monotax .”
Likewise, it leaves some articles unchanged so that they remain as they were approved in the Lower House. Among them is that related to Personal Property, tax on debits and credits and the final provisions.
The ruling party's proposal proposes that the contracts last three years and be adjusted semiannually
When will it be discussed in the Senate
The next step is the processing of the opinions in the Senate. As was the case with the Deputies, the majority opinion will be voted on first. If it obtains the necessary number of votes, it would return to the Lower House because it incorporates modifications to the project originally received. On the other hand, if it does not obtain the necessary votes, the minority opinion promoted by the opposition will be voted on. If this receives the green light, the project to modify the rental law would automatically become law because it already has the prior approval of Deputies.For now there is nothing but uncertainty about when it could be treated on site . When consulted about this issue, Daniel Bensusán (FdT La Pampa), president of the General Legislation Commission, indicated that he hopes it will be addressed as soon as possible . In the same session, the draft regulation of temporary rentals for tourist purposes that was approved on September 1 in another plenary session of commissions will also be discussed .
Mercedes Soriano
www.buysellba.com
