KUALA LUMPUR: The Real Estate and Housing Developers’ Association (Rehda) is urging the government to reconsider some of the proposals under the proposed Residential Tenancy Act (RTA), which could lead to an uptrend in rents and have a detrimental impact on the industry.

       In a statement yesterday, Rehda acting president Datuk N.K. Tong said the association supports the government’s initiative to protect tenants, but it believes that existing legislations are offering enough protection.

       “The ultimate goal should be to make any new legislation effective for the rakyat. By layering unnecessary complexity, the unintended consequence is that rents may trend upwards as landlords factor in any additional burden that they have to take on.”

       To protect the interests of local landlords and tenants, the government has proposed to enact the RTA.

       Based on reports, the Housing and Local Government Ministry is scheduled to table the RTA in parliament in the first quarter of this year.

       Tong said Rehda had submitted its comments on the proposed Act to the ministry last month.

       “Whilst there are several points in the proposed Act’s regulatory impact statement which may be helpful to resolve disputes that may arise between the parties involved in residential tenancy matters, Rehda is also concerned with some proposals in the Act which we believe should be relooked and reconsidered carefully. Otherwise, the impact could be detrimental to the industry,” he said.

       Tong said the RTA should only be applicable in specific circumstances.

       “In principle, we strongly oppose the government’s intervention in what should have been a private agreement between two parties. However, there may be a situation where the tenant is at a disadvantage compared with the landlord, thus requiring a higher level of protection; for instance, if the tenant is from the B40 group.”

       Rehda is proposing that the RTA should only apply to residential tenancies where the monthly rent is below RM750 a month.

       “According to data provided in the regulatory impact statement, this is considered the cut-off point for classification as falling within the low and low-middle monthly rent range.”

       Commenting on the proposal of having the security deposit for rental units that is to be handed to a government agency for safekeeping, Tong said this could lead to potential delays, such as for refunds and claims for damages due to the additional layers of bureaucracy.

       “Additionally, the ministry’s intention to utilise the interest earned from the deposits to fund the administration of the RTA, including to defray the costs of managing the proposed Tenant Landlord Database is misguided, as the cost should only be defrayed from taxes collected through the nation’s taxation system. Interest earned on the deposits should rightly remain the property of the depositor,” he added.