Real Estate Matters | The new laws and how they affect you
Juliet Risdon
You will almost certainly have read about the real estate laws that have been the subject of government discussion lately. Specifically, the discussion has been on the Civil Code Articles 969 – 1056 relating directly to Lease Agreements.
Overview
At first glance it appears that the idea of this review was to strengthen a tenant’s position and offer tenants added layers protection. Your view on whether this purpose is misdirected will largely depend on whether you are a tenant or a landlord.
However, the real motivation behind the review is social stability, and this of course is the primary concern of the government.
As the Macau population continues to grow, there has been increasing pressure on the government to take action on rising property prices. The high price of purchasing a property means they are under pressure to introduce measures protecting the interests of tenants.
The review addressed seven articles, all but two of which were eventually passed and published on 21st August 2017.
The changes in the Civil Code will only come into effect 180 days after the publication of the revised articles, and therefore the new code will become effective from Feb 21st 2018.
Between now and when the new articles come into effect, all agreements made remain governed by the current law.
Once the new articles are effective, all agreements including Residential, Industrial, Commercial, Agricultural etc made before that date are governed under the old law, and all agreements made on or after that date will be governed by the new law.
Finally, before we review the changes to the articles, it is worthwhile noting that the subject has drawn a lot of discussion and has been somewhat divisive.
Since the law has already been passed, it is an agents job to understand the law and make use of it to best protect clients’ interests.
Considering what’s at stake, we would urge readers to ensure that your agent has a clear understanding of the revisions and what they mean. Anything less could prove very costly indeed.
What was and was not revised;
The main areas revised concern;
1. The right to terminate an agreement
2. The recognition of signatures of the Tenant and Landlord
3. The establishment of an arbitration centre for lease agreement related disputes
Two revisions were not passed, both concerned with the concept of ‘Rent Control’ and the establishment of an index by which rent increases can be governed.
As such, these may be addressed and raised again in future, but for now the concept is shelved and the free market will be left to do its work.
Next Week: Detailed explanation of the revisions
Juliet Risdon is a Director of JML Property and a property investor.
Having been established in 1994, JML Property offers investment property & homes. It specializes in managing properties for owners and investors, and providing attractive and comfortable homes for tenants.
www.JMLProperty.com
info@JMLProperty.com
