The institution of surveyors of Kenya (ISK) said that the government should remove the 10 per cent rental income on residential buildings. This move is aimed at easing the burden on landlords. This will give rise to landlords to give benefits to tenants who are facing a difficult time due to the Covid-19 pandemic. ISK also said that Kenyans who would want their rent waived should negotiate with their landlords based on their contractual agreement.
The institution advises that discussions should be done between a landlord or property manager and tenant in addressing the issue of rent as provided in the lease agreement. This comes after reports that revealed some tenants declined to pay rent due. There have also been some occasions when tenants requested to terminate their lease. Rent payment is a contractual agreement or obligation between a tenant and a landlord.
There have been instances when most tenants issued complaints about payment of rent, as the economic slowdown has affected their ability to make payments. ISK said that there should be a consideration that includes a reduction in rent during the duration of the coronavirus pandemic. There should be a rent waiver or rent deferment with an agreement between the tenant and landlord, that the unpaid rent should be compensated if things are stable or resume to normalcy.
The government should also reduce value-added tax (VAT) on commercial buildings. This will enable some landlords renegotiate terms to reduce the amounts due from tenants. Tax relief for rental incomes will also enable landlords to waive rent for their tenants. The ISK advises tenants not to boycott payments and to ignore people who are encouraging tenants against paying their rents. The institution requested the government to intervene in such situations and protect property rights as enshrined in the law and constitution.
It is important to note that landlords have also been affected by the Covid-19 pandemic and economic slowdown. Most property owners depend on rents to meet their personal obligations. Furthermore, property owners are also expected to pay property taxes, maintain properties, pay insurances, service their loans and mortgages. The real estate sector has been affected by the Covid-19 pandemic, it is key to uphold a contractual agreement between a landlord and tenant during this period. The scale of impact is yet to be realized or declared, but the real estate sector is expected to recover.