A large number of landlords and tenants are awaiting the date of implementing the new increase in value Old rentofficially scheduled for next March, in accordance with the provisions of Law No. 10 of 2022, which regulates the rental relationship for non-residential units rented to legal persons.
This increase comes from the development witnessed in the old rent file, and the achievement of a degree of balance between the rights of landlords and the obligations of tenants, after decades of legislative stagnation.
When does the new old rent increase apply?
It is scheduled to enter the fourth increase in the rental value of Old rent It will come into force next March, given that the law began in March 2022, and three previous successive increases have already been implemented:
The first increase: raising the rental value five times.
Second increase: in March 2023.
Third increase: in March 2024.
Fourth increase: effective in March 2025.
Who will the upcoming old rent increase apply to?
The new increase in old rent applies only to non-residential units rented to legal persons, and does not include residential units rented to natural persons.
A legal person means every entity that has an independent legal personality, whether it is a public or private entity, the most prominent of which are:
Ministries, government agencies and governorates.
Religious bodies and sects and the Endowments Authority.
Commercial and civil companies.
Associations and civil institutions.
Political parties and unions.
Any entity granted by law an independent legal personality.
These entities are fully subject to the provisions of the Non-Residential Tenancies Law.
The percentage of increase in the old rent
The old rent law set the rate of periodic increase in the rental value at 15% annually, after applying the first exceptional increase, which raised the rental value to five times compared to the value before the issuance of the law.
This increase is applied automatically at the specified time without the need for additional actions from the owner.
What happens to those who refuse to pay the increase?
The law stipulates decisive legal procedures in the event that the tenant refuses to pay the new rental value, as the landlord has the right to:
Resorting to the judiciary.
Request to evict a tenant who fails to pay.
The law also specifies the final end of the rental relationship after 5 years from the date of its issuance, that is, by 2027, so that all lease contracts subject to this legislation are terminated.
What about increasing the old residential rent?
In parallel with this, another law regulates the increase for old residential rental units, as it was decided to implement an annual increase starting in September of each year for a period of 7 years, within the framework of a gradual plan aimed at restoring balance to the rental relationship as well as bringing the rental value closer to the fair price as well as taking into account the social dimensions, especially for the elderly and low-income people, in accordance with the explanatory memorandum submitted by the government with the law.
This plan includes transitional periods of 7 years for residential and 5 years for administrative, with the provision of alternative housing units through the Ministry of Housing.
