Kuwait Govt Unable To Solve Issue Of Huge Surge In Rents A majority of respondents in this week’s Arab Times online poll regarded the Kuwaiti government’s inability to provide a solution as the main reason behind escalating rents. 51 percent of voters chose the government’s inaction above demand and supply dynamics and other economic factors. The rationale behind this may be that rent inflation in Kuwait seems to be more arbitrary than market driven. Expatriates across Kuwait are becoming increasing peevish about increases that take out bigger chunks off their disposable income. “It doesn’t seem that the government is keen on alleviating the pressure that high rents are putting on families, I am not aware of any regulatory mechanism in place that actually ascertains an apartment’s value by its size, location, facilities provided etc. It just seems like it’s up to whatever the landlord decides to charge for it”, a frustrated reader commented. “We were recently alerted by our building harris that the rent of the apartment we have been living in for four and half years now will be increased by KD 100 and if this is not acceptable, we are free to find another place. I don’t see what the rationale behind this price hike is because the rooms are like a pigeon hole compared to the older buildings we used to live years ago”, a concerned renter in Salmiya shared. Unfortunately for tenants, the owner has the law on his side as he can legally raise the rent once every five years if the rent is 50 percent less than the market price. Tenants can avail of their legal right to challenge the increase by taking the case to a rents court and paying the rent there before the 20th of each month. The court will designate an inspector to study the building and submit a report at the next hearing. The report will only focus on the current rent, the rent proposed by the owner and the average rent of such buildings. The court will then decide, based on the reported findings, whether the rent increase is justified or not. It could also propose a rent for the building. This would be binding on both the landlord and the tenants. 3 percent of voters found that increase in land prices were a major factor in high rents and 6 percent stood by the view that loan pressure for new buildings on real estate owners was the reason for exorbitant rates. “With land being such an expensive commodity in Kuwait, those who invest in it are looking to procure their money back as soon as they can and so undue burden is being passed down to the renter. I think it is very unfair and unfortunate. The only real solution can come from the government taking a hard look at its housing policy and making systemic changes”, another voter shared. 15 percent blamed population increase and 7 percent held shortage of apartments to be the contributing factor. “A new building came up next to the one I live in, so I went to check out the flats there. The rooms were very small and the rent was outrageous. I kept thinking that nobody would occupy the flat for that price and it would eventually come down. But within a month, most of the apartments were already occupied. So I guess there must be a shortage of places to live”, a resident of Hawally stated. Only 1 percent of voters regarded that a high cost of labour force contributed to steep rents while 4 percent cited the lack of investment opportunities as a significant factor. 3 percent held that increase in salaries were an important factor. “It is not just rent that has gone up. The cost of living has drastically increased in a short span. I think this is because a lot of people can afford to pay for this with their high salaries,” a respondent pointed out. 11 percent believe the increase was brought on by concentration and clustering as expats prefer to stay near schools, urban areas. “Certain expat communities do tend to form little clusters and live together. Also if you’ve lived in a particular area for many years, it’s hard to move out of there. I think building owners are exploiting this to their advantage”, a resident of Salmiya shared arabtimesonline/NewsDetails/tabid/96/smid/414/ArticleID/209241/reftab/36/t/Kuwait-govt-unable-to-solve-issue-of-huge-surge-in-rents/Default.aspx
Posted on: Thu, 11 Sep 2014 09:27:25 +0000
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