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Wednesday , September 30 2020

Time bomb ticking for real estate sector, say experts

‘Need to resort to consensual solutions’

KUWAIT CITY, July 13: Real estate experts say the time bomb is ticking and may explode at any moment and will cause more damage than what has already been done because of the after-effects and repercussions resulting from the outbreak of COVID-19 pandemic, reports Al- Seyassah daily.

According to the views of experts in this field stated the courts that have resumed work and will look into about one million lawsuits related to evicting tenants for failing to pay rents after most of the businesses remained shut when the nation opted to prevent the spread of the virus by imposing lockdown and partial curfew in some areas.

The experts stressed on the need to resort to consensual solutions between real estate owners and tenants to contribute to solve the problem amicably of the rent dispute be it of residential or commercial nature – the problem caused by the coronavirus calamity.

They noted the judicial solutions are not feasible and will take long time in light of the current rent law, which because of the loophole and is based on an explicit text that protects the lessor and the tenant during crises and disasters – natural or man-made.

Crisis
The current crisis that the sector is going through, the experts say, is the result of government decisions and measures taken to prevent the spread of the virus as a result of which the real estate sectors were negatively affected and explained to treat the problem of late rents, they must be divided into several segments, so there are those affected and these should be tolerated and there are those who must be treated firmly without complacency.

The experts have called for the need for the executive and legislative authority to move quickly to amend the ‘rent’ and ‘work’ laws, because most of the problems and cases that will go to the courts will be through these two laws, noting that the delay in amending the laws will exacerbate the crisis and create new repercussions that we will not be able to address in the future.

They stressed the need to have a clear role for federations, the Chamber of Commerce and Industry and public benefit associations to solve real estate lease problems before the issue moves to the courts, expecting occupancy rates in investment housing to decrease by about 50 percent during the next six months as a result of the slowdown in the economic movement and the decision of some ministries and government and private institutions to do away with expatriates.

 

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