Subletting social housing units still incessant

Shaimaa Al-Aees
5 Min Read

Egypt’s government has been succeeding in solving the housing crisis in Egypt, by providing housing for low-income people and is being completing construction of nearly 1m housing units.

However, some of the owners of such properties have taken to selling or renting their properties through subcontractors in double the price, although they received these units with the state’s mortgage finance, as, the government has provided thus far EGP 17bn as a mortgage fund to serve 200,000 clients.

Daily News Egypt received some complaints from unit’s owners, noting that the subletting of the units is still incessant. Some owners are offering up their properties to workers and families at prices ranging from EGP 700-1,000 a month.

This issue has left social housing owners being split into two camps. The first group wanting to rent or sell their units, while the other calling on the state to prevent the city from becoming an informal housing area.

Those that want to rent their homes aim to raise the monthly rent price from EGP 500 to EGP 700, adding that once the city is fully integrated within the region that they wish to raise prices to between EGP 900-1000.

Saif Yasser a unit owner in Dahshour said many owners cannot afford the instalments owed on the unit. He does not mind renting his house to other families, but would not rent it to labourers.

Ehab Mohamed, another owner, said many labourers have taken residence in these units, making a lot of noise and dirtying the inside of the building.

While some unit’s owners such as Yasser may refuse to rent their homes to labourers, others have found that doing so creates conflict within the building. Tarek Sanad, a homeowner, said that the building’s security guard had asked him to rent his apartment to labourers, but he had refused. Afterwards the guard began treating him differently, and he is worried the guard may vandalise his housing unit if it is left vacant.

Other residents and homeowners opposed the presence of labourers. Ahmed Abdou, a resident in the area, said some labourers are drug addicts, who make a lot of noise and often knock on other people’s doors.

Meanwhile, A real estate agent said that he is offering different housing units between social housing project and Dar Misr project (middle income housing project), according to the desire of every buyer. The housing units of Dar Misr project full of services water, electricity and gas, is being sold for EGP 10,000 instalment every three months, and becomes EGP 16,000 after delivery, and the rest of the instalments are repayable in a period of four years.

He added that he is selling housing units in various areas in the social housing project at prices ranging from EGP 140,000, EGP 160,000, EGP 180,000, and reaches EGP 200,000 on instalment period over 20 years.

He explained that the owner will make a final sale contract for the new owner to get the validity of the signature of the court to ensure the right of the new owner in the unit and after five years, the unit will be legally owned.

Article 5 of the Social Housing Law 33/2014 states that it is forbidden to rent or sell a social housing unit before five years have passed since signing the original contract with the office, which the housing unit is affiliated to.

Meanwhile, Article 6 of the same law states that every rental or sale of a social housing unit violates the provisions of this law, and prohibits notaries from notarising such acts.

In April 2017, the housing minister took advantage of a decree granting employees of the Mortgage Finance Fund (MFF) the right to monitor the behaviour of the owners of social housing units, according to executive director of the Social Housing Project, Salah Hassan. This was done to prevent the sale or lease of their properties.

The Ministry of Justice issued a decree in 2014 to grant some MFF employees the right to arrest violators of law 33/2014, but it has yet to be used.

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