I do not know what to make of this article in the News Section

[JMot]

This is the article:
https://www.news.cyprus-property-buyers ... d=00165230

The beginning is very contradictory, it first says that there is nothing the government can do about the disparities in the job market, which is totally false since in most of the EU the job market is tightly regulated and then at the same time it advocates for rent control that caused havoc to the real estate inventory in Cyprus (just look at the multitude of decrepit buildings of the 70s and 80s with rent control tenants and no maintenance):

Market forces determine the disparities in the jobs sector, and there is nothing anyone can do about it.
However, in the absence of rent controls, the state has no policy whatsoever regarding lower-income households.

Then it comes out with another pearl:

Constructors were not keen to allocate part of their new developments to low-cost housing, with the measure interpreted as ‘cheap’ housing, meaning a studio or tent-sized one-bedroom being sold at low cost.

This is the market, there is very little profit for building companies in low-cost housing, that is why usually the state provides financial incentives or cheap land for this type of housing in exchange for social housing.

And how to ensure low-cost housing (a.k.a. affordable housing) would not be rented out at exorbitant rates due to high demand from students or young professionals?

The state becomes the landlord (a.k.a. social housing) and keeps a tight control on subletting. Guess the Cypriot government prefers not getting its hands dirty with managing property

This has landlords delighted that they can now hike their rents, and they will get away with it, justified by the laws of supply and demand.

Again blaming the landlords for lack of supply in the market that causes rent increases, like they should susbtitute the state for social purposes that are NOT THE RESPONSIBILITY OF LANDLORDS!

This type of one sided, flawed article on housing is very easy to find nowadays in the main stream media in the UK or Ireland (usually performed by leftists or populist journalists serving the interests of politicians trying to deflect the blame of the massive housing crisis there and getting easy populist votes), however I did not expect to see it in a specialist property news site in Cyprus, where the "editors" should know better than these easy simplifications. I like very much the site and the forum, but this article was really a major slip in quality of information.

Rental increases in Limassol (a market I know pretty well) are very limited compared to what happened and will continue to happen in Ireland and the UK due to the creative destruction of housing supply (through over regulation, rent controls, over taxation, ...) over there. I can see plenty of construction in Limassol, just not the type the author of the article is wishing for.

I only agree on one point with the author: the Cypriot government has no policy at all about social housing (maybe very few votes on this policy?)

[Pantheman]

Wow! That was a long post, just to say you din't agree with the article.

I'm not sure I got your point though!!!!

Rent control in a free market is a no no, in my opinion and trying to compare Cyprus with the UK and Ireland is comparing apples and oranges.

Cyprus has its own culture, the government has limited resources for housing (it would be nice if everyone had a place, not even in the UK can you get this), my main gripe with rentals, is the lack of eviction laws to evict bad tenants whilst the landlord suffers losses.

As for the old rent control properties, this is out of date and if the government want to limit the rents that can be charged they should also be responsible for their upkeep.

The recent amendment to the rent control law with regards to evictions is most welcome, it stops many taking advantage of the law in the first place.

[Nigel Howarth]

Hi Both

You can't compare Cyprus with the UK.

In my past I was a local councillor in the UK and building developers often had to contribute to local amenities, such as roads and other facilities. There was also legislation of they built a number of houses in a development, they also had to build a number of affordable homes. There's no equivalent in Cyprus.

The reason there are so many shoddy developments is the boom that ended in 2007 when many rubbish developments were constructed.

Also, the law on Jointly-Owned Buildings is hopeless to say the least. If owners so not contribute their share towards insurance, maintenance, repair, etc. the development falls into disrepair. Management Committees can take debtors to court, but that can take years and debtors pay off their debt a few Euros a month. If they continue to refuse to pay, it's another case in the court. It can take years to resolve (while the buildings fall into disrepair.) It also has a domino effect as the owners who are paying are obliged to make up the shortfall - eventually they stop paying. It's a complete mess.

Regarding low-cost housing, I understand the government is using some of the revenue it receives from the casinos to help build affordable housing.

Regards

Nigel