Law on rents: what is the official project to modify it


The government has already repeatedly stated the need to amend the current Tenancy Law (No. 27,551) and argued that it did not have the expected results. From the sector, they agree that reduced the offer of rental properties and generated increases very important in contracts.

Now the official assistant Jose Luis Gioja and 14 other colleagues presented a bill amending the current regulations. According to them, the objective is to improve the conditions for hiring tenants and, at the same time, to grant tax advantages to landlords, which include relief from property tax for 15 tax periods.

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Among the reasons for the measure, the authors pointed out that the general orientations of the current law “must be maintained and reinforced”. Therefore, the proposal does not seek to change two of the most controversial points of the law: the minimum three-year contract and to one-time annual adjustment for inflation.

The ruling party promotes a new rental law in Congress (Photo: Télam).

“The current law is criticized by those who have the most because it caps rent reviews and determines a single annual review. Before the law, they could make any adjustment and for the number of times in the year that they imposed on tenants. The legal text in force provides them however, increases above average salary increases“, argued the signatories of the project.

The keys to the proposal to modify the law on rents

Among the highlights of the initiative is a cap increments for renewals and new contracts (although they will continue to be annual and inflation-based). So they will be:

  • the starting price location of renewed contracts allocated to housing will be capped at an additional 10% corresponding to the annual revaluation provided for by the law in force. In other words, if the regularization index before a renewal was 40%, the initial rental price of the renewed contract can only increase by up to 50% compared to the last price paid by the tenant.
  • the initial rental price contracts intended for housing will have a limit of 20% additional to that which corresponds to the annual adjustment provided for by the law in force and this limit will apply to all real estate that has been rented for residential purposes during of the last five years. The ceiling can be increased by five additional percentage points for each full calendar year that elapses between the termination of the previous lease contract and the following one.

The initiative also poses relief for tenants monotributistssince he proposes that they can take surety insurance without requiring more supporting documents than proof of registration with the AFIP and proof of payment for the last 6 months. Moreover, it establishes that they cannot be invoiced more than dependent employees.

The Frente de Todos deputy, José Luis Gioja, announced the presentation of the project on his social networks.  (Photo: Twitter José Luis Gioja, @joseluisgioja).
The Frente de Todos deputy, José Luis Gioja, announced the presentation of the project on his social networks. (Photo: Twitter José Luis Gioja, @joseluisgioja).

The registration of contracts with the AFIP is another of the shortcomings of the current rental law. To solve this problem, the bill provides tax benefits for owners that they declare them during the 15 fiscal years following the entry into force of the standard:

  • The amounts landlords charge for rentals can be deducted from gross income annual monotax scheme.
  • Real estate located and registered will be exempt from property tax for each year and fiscal period in which the respective contracts were registered and/or with a current contract.

What does the empty housing tax bill say

For to fight against the lack of land in rent, voices within the ruling party and among tenant representatives have proposed creating a tax on empty housing.

What is the official plan to amend the Tenancy Act

In the fundamentals of the bill, the signatories recall: “Another unreasonable blow given by the real estate market before the entry into force of Law 27.551 was withdraw from the rental offer several properties and leave them uninhabited and/or put them up for sale”.

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“With a idle housing taxmore the stimuli for registered lease agreements, it could be favor the offer rentals, both in number of units and in terms of price”, they estimate.

However, they indicated that this possibility should be implemented “at the local levelboth for fiscal power and for control”.

a house plan

Finally, the project proposes to design a plan through Federal Housing Council including:

  • the building of real estate in urban centers across the country for rental.
  • The construction and acquisition of houses and apartments for public management of social rentalsparallel to the private market and with lower prices.

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