How landlords, tenants upcountry view new law

Wednesday July 24 2019

Real estate. Former Qualicell building in

Real estate. Former Qualicell building in Kampala where traders were locked out following disagreements between tenants and landlords last year. Photo by Stephen Otage 

By Monitor Reporters

On June 26 , Parliament passed the Landlords and Tenants Act, 2018, and it now awaits presidential assent. Among the key provisions in the Bill is that landlords and tenants must sign tenancy agreements for rent transactions of more than Shs500,000 with clear terms and conditions.

Also, tenancy disputes have to be handled in local council courts and other courts of law. The Bill also states that landlords can only evict their tenants after securing court orders.

Landlords must also give tenants an eviction notice of six months and any unlawful eviction will attract a penalty of Shs5 million or jail term of one year or both upon conviction.
Government says this legislation seeks, among other things, to regulate the relationship between landlords and tenants.

It is also expected to promote access to adequate housing as well as creating a mechanism for proper functioning of rental market for both residential and commercial premises.

But the most controversial provision is the one which stipulates that rent fees should be paid in shillings, not in dollars as some landlords, especially in Kampala, have been doing over the years. This has caused outmost discomfort among landlords in Kampala.

The landlords claim the Bill, introduced by Lands, Housing and Urban Development Minister Betty Amongi last year, largely favours tenants.

Advertisement

Complications
The same sentiments are shared by their counterparts in the countryside. Some of the landlords in towns upcountry who talked to Daily Monitor describe it as a bad legislation and wonder how it will be enforced.

Ms Christine Gire, a landlady in Njeru Municipality, Buikwe District, says if President Museveni assents to the Bill, it will affect the relationship between landlords and tenants.

“The six–month period stipulated in the Bill before a tenant can be evicted is long and will automatically encourage tenants not to pay rent in time and will force us to start asking for a lump sum payment of one year before tenants occupy our buildings,” she says.

The Bill saves tenants from uncertainty over increment of rent. Clause 27 of the Bill states that increment on rent will not be more than 10 per cent annually. Tenants will also enjoy their right to privacy in rented premises without frequent interference by the landlord and Clause 53 of the Bill requires a landlord to give a 24-hour notice prior to visiting a rented property save for emergencies such as fire and other disasters.

Mr Francis Ssentongo ,the owner of Sentongo Apartments in Masaka Town, says government should shelve the Bill and allow nationwide consultations due to the stiff resistance it has faced from landlords.

“It is good the President has not yet assented to it. Let them (government) withdraw it and accommodate our views. If not that, it will be a bad law and its implementation will be hard like the unpopular Land Act,” he says.

Mr Kennedy Ssegawa, the secretary Masaka Landlords Association, says the framers of the Bill were right to reject payment of rent in dollars because it was unfair to tenants. However, he opposes the six-month grace period landlords should give their tenants before leaving their premises when there is breach of tenancy agreement.

“Someone who is defaulting on rent should be given two months to get another house. Proposing six months when someone is not paying rent is unfair to the landlords,” he says.
Mr Ssegawa says a clause should be inserted in the Bill compelling tenants to pay rent arrears even when they have left the premises.

“Sometimes tenants just run away without paying rent and this is affecting us. A clause should be added in the Bill to force tenants who fail to honour their obligation to do so. Some tenants keep shifting from one building to another without paying accumulated rent arrears,” he adds.

Mr Obed Ssebanakitta, a retired civil servant who owns rentals in New Kumbu, a posh Masaka Town suburb, says the new legislation is unnecessary since the country’s informal real estate sector is still in its infancy .

“ What they (government) are doing is like killing a baby in its infancy. I don’t think we have reached a level where we need such a legislation. It is just because our parliamentarians are redundant. Instead of focusing on pressing laws like those on electoral reforms, they are wasting time on trivial issues,” he says.

Since the Bill was tabled before Parliament last year, government has backed it, saying it will promote access to adequate housing as well as create a mechanism for proper functioning of rental market for both residential and commercial premises.

Recently, Ms Amongi said the Bill was passed with numerous amendments which relate to duties and rights of landlords and tenants in rented commercial and residential premises, implying there is no need for further consultations.

Ms Anna Lakaraber, a landlord in Gulu Town, says many of her counterparts have suffered at the hands of bad tenants who fail to pay their rent fees in time and when they are reminded, they turn violent.

“I have been a victim of that. Last year, I lost Shs3.5m because the tenants could not pay rent but wanted to continue occupying my houses. I just pray that they (government) make some amendments in the Bill so that when passed into law, it will help both landlord and tenants,” she says.
Mr Alex Lukiamoi, 79, another landlord in Gulu Town, says if the Bill becomes law, it might worsen the relationship between the tenants and landlords.

“There are already in place ground rules between landlords and tenants, why do we have another law? For what?” he asks.

Mr Gad Kelvin Baguma Apuuli, a tenant in Fort Portal Town, says he is happy with Clause 49 of the Bill that requires a landlord to give a six-month notice to the tenant to vacate a premise if he fails to pay rent.

“I support that because no tenant will have failed to raise any amount of money during that period,” he says.

Mr Apuuli adds that if some landlords want to continue receiving their rent fees in dollars, they should find other ways of convincing government to add value to the Ugandan currency.

“Some landlords take advantage of tenants by demanding payment in dollars knowing that our shilling depreciates against the dollar every day,” he says.

But Ms Anna Mbabazi, a landlord in Fort Portal Town, says a six-month notice before eviction is a lot of time and she proposes at least one week.

“The landlord may be having plans of renting the premises to other people who are not troublesome, that is his right. And that’s why tenants should be given one week because in six months, they will just give you headache and run away before clearing the arrears,” she says.

However, Ms Jessica Masika, a tenant in Kasese Town, says she supports the Bill because the tenancy agreement is important for the tenant.

“It protects a tenant because there isn’t unnecessary rent increment. The landlord can’t increase rent without the tenant’s consent,” she says.

Mr Arthur Namara Araali, a landlord at Kitara-Entebbe, Wakiso District, says the Bill was hurriedly passed, adding that it would create more chaos than it intends to address.

“I am both a tenant and a landlord. For example, the law doesn’t give a solution when the tenant damages the premises. It just talks about the landlord’s responsibility to repair. I would advise the President to defer assent. There is no fairness in that law,” he says. Mr Nelly Rugumayo, a landlord in Entebbe Town, says: “I own houses in different areas across the country and most of them are rentals. This law is going to make tenants untouchable, six months without someone paying you is too much time, and unscrupulous tenants will use this clause to cheat us.”

Effect on business
Ms Lydia Nambalirwa, a tenant in Nakiwogo, a suburb in Entebbe Town, says: “Some landlords will be hesitant to allow us on their commercial buildings and [yet] location of a business is important. We are likely to lose clients in such situations.”

In Lyantonde Town, Mr John Kasimba, a tenant, says making tenants sign agreements will help ease the burden of collecting rent.

Mr Adam Tusimire, another tenant in the same town, says he is optimistic that the law will punish stubborn landlords who unlawfully evict tenants whenever they feel like.

“The six months notice is good enough for me to prepare and look for a new house,” Mr Tusimire says.
Mr Peter Kyeswa, a landlord at Kijjukizo Village, Lyantonde District, claims government is pushing through this law to win support from ordinary Ugandans majority of whom are tenants. “Government only wants to show that it cares for the tenants and get votes in return,” Mr Kyeswa says.

In Gulu Town, Mr Bravo Ariho, a tenant, says involving court to sort out evictions is bad for business.

“It makes it very expensive and simply adds to the backlog of cases before the Judiciary. How long does it take to conclude just one case? Unlawful evictions must be made expensive. Anyone who does it must be made to pay heavily,” he says.

Mr Stephen Olanya, a landlord in Gulu Municipality, also the chairperson Green Valley Village, says the Bill will help many tenants from being unfairly evicted by their landlords.

He cites a number of tenants, especially in Gulu Municipality, who have recently been evicted simply because another tenant negotiated with landlords a higher amount than what they were paying.

However, Mr Olanya says despite the Bill being passed, he still has the power to evict stubborn tenants who don’t pay rent promptly, damage houses or have criminal records.

Kicked out. Tenants prepare to leave after they

Kicked out. Tenants prepare to leave after they were evicted from a building at Old Kampala in 2017. File Photo

In Budaka District, particularly Budaka Town Council, both landlords and tenants have mixed reaction on the Bill. Landlords say the legislation is intended to drive people out of the business.

“The Bill majorly favours the tenants in the sense that they will be moving from house to house upon defaulting payments, and in any case of evictions, the landlord will be jailed which is unfair,” Mr Wako Mboizi, a landlord, says. In Mbale Municipality, Mr John Wasakana, a landlord, says the Bill will only have a dampening effect on the private sector because some clauses are too harsh on the landlord.

“Many landlords are going to run-away from this business thus creating a housing deficit because of the discrepancies in the Bill. Somebody (tenant) has failed to pay rent despite the investment in the construction of these houses, but this Bill does not allow evicting them,” Mr Wasakana says.

Mr Godfrey Edema, a tenant of MK Premises at Okudi Road in Moyo Town, says the Bill should also address other concerns such as landlords charging other utilities like water and electricity separately.

“This thing is giving tenants hard time and it would be better if the Bill also takes care of such concerns,” he says.

According to clause 50 of the Bill, the landlords will no longer rent out toilets in commercial buildings since they will be part of the rent agreement. But tenants will pay for extra amenities such as security, sanitation and conservancy.

Mr Simon Ecima, a businessman and landlord at Moyo Main Market, says if the President assents to the Bill, it will force many landlords to evade taxes levied on property.

“How does government expect me to pay taxes and school fees for my children if defaulting tenants are given six months to leave?” he asks.

Ms Grace Apio, a tenant in Nsambya South Village, Awindiri Ward in Arua Municipality, says landlords have for long exploited tenants and the time has come for the latter to get justice.

“Everything has its time and I think their (landlords) exploitation will soon come to an end,” she says.

Mr Simon Vvuubi, a landlord and owner of Simon’s Food Mart in Mubende Town, criticises a clause in the Bill that requires a landlord to seek a court order before evicting a tenant.

“Usually, the court orders take long to be processed. So, should I just sit and wait as a tenant who has failed to pay rent for over three months continue sleeping comfortably in my house?” he asks.
Mr Simon Mutyaba, another landlord in Mubende Town, says like it has proved difficult to enforce other existing laws, even the new Bill will suffer the same fate .

“This is a private property and whatever agreement I make with my tenants is entirely our own concern. Even if I am forced to provide the tenancy agreement, it might be clearly stated on paper, but will not be followed by both parties,” Mr Mutyaba says.

In Jinja, Mr Abdallah Zein, a landlord on Plot 46 Main Street, says the Bill is not bad, save for the six-month grace period which is “too long” for the tenants to vacate rented premises. “President Museveni should not assent to that Bill because it affects us yet we spend a lot of money building those houses.”

“A period of six month is too long; at least three months is favourable because if I have got money to renovate my house, I can’t wait,” Mr Zein says.

Mr Ernest Nakibinge, a tenant on the building, commends Parliament for passing the Bill, saying it will stop landlords from evicting them without notice.

Mr Charles Balondemu, a tenant on Jinja’s Main Street, says landlords can only benefit from the law if they involve tenants in meetings when they plan to increase rent.
Mr Balondemu says the law would ‘awaken’ landlords to renovate some of their buildings, some of which lack lavatory facilities.

Local developers
In Soroti Town, a section of landlords describe the Bill as detrimental, saying it will discourage local developers who are interested in establishing commercial houses for rental purposes.

Mr Patrick Etiru, a landlord in Oderai Ward Western Division, says government should appreciate efforts of local developers for turning around the country’s housing sector, claiming that they are lead contributors to the Ugandan’s economy since they pay ground rent and rental tax.

“Imprisoning landlords over a minor mistake of eviction that may be caused by tenants can only discourage aggressive local investors from establishing commercial structures for the growing population,” he says.

However, Mr Joseph Omaido, a resident of Moruapesur, Eastern Division, is happy that the time frame of six months will give room for a tenant to look for money and another premise.

Ms Alice Nagasha of City Homes, a real estate company, welcomes the Bill, saying this will help in settling disputes between tenants and landlords.

“Some tenants default, close the houses and go away for months but you find a challenge in evicting him or her. Some default and when you attempt to evict them forcefully, you end being the victim, being sued and end up paying a tenant who has defaulted,” Ms Nagasha says.

Mr Abel Kigandire, a landlord in Kakoba Division, Mbarara Municipality, says some clauses in the Bill need to be amended before the President signs it into law .

“The Bill seems to be okay but some sections are clearly bending to give leverage to tenants to exploit us like the six-month eviction notice. And even after giving a notice, one has to secure a court order to evict an errant tenant, this is unfair,” he says.

Tenants, landlords say
Stephen Olanya, landlord in Gulu Municipality: “Many people are being evicted by landlords because some foreigners, mostly Asians, have negotiated with them a high amount in terms of rent so that they establish their businesses. They evict even when the tenant has been duly paying their rent.

Mr Simon Vvuubi, landlord in Mubende Town : “Six months is a lot of time and if one is issued with the eviction notice, the tenant is likely to disappear and I will be the one losing income which would have been generated from payment of rent arrears.”

Ernest Nakibinge, tenant in Jinja: “We pray that it becomes law to give us more opportunities to negotiate with the landlords which wasn’t the case before. In the past, we have seen tenants lose a lot of their belongings during the eviction process.”

John Justine Opolot, landlord in Soroti Town: “I don’t support landlords who mistreat tenants, but in this particular case, government should go slow. There are many Ugandans who want free things, tomorrow someone will politely enter into your house and becomes a public nuisance. He declines to pay rent, returns home late in the night; he is a drunkard and a noise maker, a thief or practicing wrong things and when the landlord raises a voice, he becomes a problem because he is favoured by the law.”

Mansoor Mubiru, landlord in Mbarara: “Who (MPs) did they consult before passing that Bill? It came to us as a surprise when it was passed because we were not consulted even we are not aware of what it contains.”

Ismail Lukwago, tenant in Mubende Town: He says the law is timely and hopes it will tame landlords who mistreat their tenants. “Our landlord removed iron sheets from my neighbour’s roof because she was demanding Shs100,000 in rent fees for two months. When it rained the following day, all his property got soaked in water and he lost almost everything,” he said.

Compiled by Felix Basiime, Al-Mahdi Ssenkabirwa, Denis Edema, Rajab Mukombozi, Cissy Makumbi, Julius Ocungi, Malik Fahd Jjingo, Muzafaru Nsubuga, Paul Ssekandi, Moses Okeya, Mudangha Kolyangha, George Muron, Felix Warom Okello & Scovin Iceta

Advertisement