Guest Post: Understanding the Israeli Fair Rental Law

Today’s post comes courtesy of Avi Bieler from Kalpi Blog, an English-language website dedicated to providing non-ideological coverage of Israeli politics and policy.

Thanks for having me!

The editors and massive general staff of this blog asked me to break down the recently passed renter’s rights law.

In the past, I covered the first reading of this bill, so feel free to check out that piece for a basic rundown of the kind of protections that this law is enacting.

As this is a construction blog, I want to consider this law from a different point of view. Namely, that of the contractors and owner.

The law is fairly simple: Terrible apartment owners who rent out their spaces while making no effort to care for them will now be forced to meet minimum standards.

When I wrote the first article, I heard stories from people that were sad/hilarious. One owner hired a contractor to fix a toilet, took the toilet out and then… nothing. For months. But don’t worry, he gave the renter a key for another toilet down the street.

Because leaving a rental contract and finding a new apartment is complicated and the rental market is so tight, predatory land owners could get away with this behavior. This law stops that.

The consequences of laws that impact economics are as unclear as a teenager’s skin, however. In a recent example, the government slashed the price for 3-4 year preschool. Consequently, parents had more disposable income and began to use it to take care of their other preschool needs. Unsurprisingly, the price for 2-year-old preschool shot up in the process and the price of education for 2-5-year-olds only fell by 3% as a whole.

The free market giveth and the free market taketh. Blessed be the free market.

It is sensible to ask how this law will affect rental prices even as it improves rental conditions. I know that in apartments I’ve lived in, owners have stored some of their belongings in the apartment, a practice that they now must stop. Will this be enough for them to ask for more money when renting the apartment? How much money?

Additionally, I’ve had friends live in terrible apartments that were not up to the standards set by the law, but which were good enough and cheaper. Will the owners now pull these apartments from the market and decrease supply? Will they fix them up and then charge significantly more? Could this law scare investment owners from purchasing new apartments thereby affecting building contracts?

I obviously could tell you the exact answers to all these questions, but then why would you ever come back to read Jerusalem Construction News or Kalpi? In the meantime, keep on reading.

Guest Post: Understanding the Israeli Fair Rental Law