On Tuesday, March 21, 2023, the Good Landlord Act passed the first chamber as a hammer piece. This bill gives municipalities more opportunities to protect tenants from abuses when renting housing. Thus, municipalities can impose additional requirements on the landlord when it comes to the maintenance of the property and the maximum rent of regulated rental housing, among other things. The central government has indicated that the law is likely to take effect July 1, 2023.
The main changes and consequences are listed below.
Rules apply to both landlords and rental agents
The rules of good landlordism apply not only to the landlord himself, but also to the intermediary or rental agent engaged by the landlord. The rules apply to both private/commercial landlords and admitted institutions. This automatically ensures that the risk of possible (financial) sanctions from the municipality lies with both the landlord and the letting agent.
Transparent selection process
When the property is offered (online), it must appear that everyone who meets the selection criteria has a chance to rent the property. There should be a clear and transparent selection procedure with objective selection criteria. If possible, the landlord should allocate by order of registration or application. These are objective and transparent factors. Rejected applicants should also be informed, with the reason for rejection.
Written rental agreement
It becomes mandatory to always enter into a written rental agreement. The written rental agreement has, of course, been a standard for some time but will now have a legal basis.
This obligation applies only to leases entered into after the law comes into force.
Laws and regulations
Both the landlord and the rental agent are obliged to comply with the legal rules regarding rent and service costs. This already follows from the relevant rules (these are usually of mandatory law), but is now also anchored in the Law of Good Tenancy, with sanctions for violation. These sanctions can be imposed on both the landlord and the rental agent. This article will also further explain the sanctions.
Security deposit
The security deposit may not exceed two times the bare term rent. The deposit must also be returned to the tenant - subject to certain exceptions - within 14 days of termination of the lease at the latest. The amount of any service charges for gas, water and electricity will therefore also have to be taken into account. In practice, it will not be possible for many energy companies to send an interim statement of the actual costs within 14 days.
Information to be provided in writing to the tenant
Landlord is required to notify Tenant in writing of, among other things:
- The rights and obligations with respect to the leased property;
- The amount of the deposit and how it will be returned;
- The contact information of the owner/manager;
- The contact information of a hotline (to be set up by the municipality) where the tenant can address complaints;
- The payment obligation with regard to the service costs whereby the tenant must receive a full cost breakdown annually;
Please note that this obligation also applies to pre-existing leases; in these, the aforementioned information must have been provided to the tenant within one year of the law's entry into force.
Additional rules for renting to migrant workers
The following additional rules apply to rentals to immigrant workers:
- The rental agreement is recorded separately from the employment contract;
- The information referred to in the preceding paragraph must be in language understandable to the migrant worker.
Municipalities may also establish a rental permit for renting housing to labor migrants. In doing so, municipalities may attach conditions to the permit with respect to the maximum number of persons per room, provisions for hygiene and with respect to facilities for storing and preparing food. This permit is not area-specific.
Municipality may set further rules: rental permit
The law also opens up the possibility for municipalities to include in an ordinance further rules including a prohibition on renting without a permit. In such a case, you as a landlord will need a rental permit to rent out your property.
This gives municipalities the power to impose additional requirements on landlords in vulnerable neighborhoods in relation to maintenance and, in the case of regulated independent rental housing, the maximum rent of a property.
Sanctions/enforcement
Municipalities are responsible for monitoring and enforcing the general rules and, if applicable, the rental permit. The law has the following penalties for violation of the Good Landlord Act:
- Revocation of the permit, if there is a permit requirement in that municipality;
- Custody: the municipality may require the landlord to give the housing accommodation to a custodian;
- Imposing an administrative fine on both landlord and rental agent;
- Imposing injunctive relief on both landlord and rental agent.
Municipalities should also establish a hotline where reports can be made anonymously and free of charge by tenants of undesirable rental behavior. The contact information for this hotline should also be included in the rental agreement.
Sources:
Central Government
Upper House of the States General
Tomlow Lawyers