The end of speculative rental of out of repair housing

The Bill, which was tabled by the Danish Government in December 2012, includes the following changes to the existing rules:

• The local authority may bring cases before the rental tribunals
• The right to deprive rental property managers of the right to manage rental property is extended

Local authorities bringing cases before the rental tribunals

The purpose is to deal with persons who systematically buy uninhabited and very run-down homes in order to let them at a price which by far exceeds the value of the homes. If the Bill is adopted, the local authority council will, on behalf of the tenants or alternatively at its own motion, be able to bring cases before the housing tribunal in serious cases of disrepair. The rule concerns the cases where the building is just short of condemnation, i.e. a prohibition against using the building for human habitation due to health and fire hazards to its users.

The rule does not affect general, less serious cases of disrepair. A local authority cannot bring cases concerning the state of repair of dwellings unless the disrepair is so material and serious that it makes the dwelling less fit for human habitation. It may e.g. be a run-down roof with visible leaks, cracked and peeling brickwork, woodwork with visible dry rot damage, broken window panes, etc.

Extended disqualification scheme

In certain cases, the Danish Rent Act makes it possible to deprive a landlord of the right to manage rental property. This applies to cases where the landlord owns more than one rental property and the landlord has repeatedly violated the law. The existing rules do not apply to the rental of residential housing which has not been approved for such purposes under Danish building legislation.

The new rule means that the disqualification scheme will in future also include cases of repeated violation in this area. More specifically, the change implies that if a landlord who owns more than one rental property is given two or more fines for renting property for residential purposes which may not lawfully be used for such purposes, the landlord may be deprived of the right to manage all rental property.

IUNO's opinion

The new rules extend the right of local authorities to clamp down on rogue landlords. The rules do not affect rental property which is merely subject to normal wear and tear. The building must be close to uninhabitable to be subject to the local authority's right to bring action.

The scheme does not apply to landlords who own only a single rental property. On the other hand, professional landlords must be aware that in future renting property for residential purposes may have far-reaching consequences if the property has not been approved for human habitation.

[Bill to amend the Danish Rent Act, the Danish Act on Temporary Regulation of Housing Conditions, the Danish Act on the Rental of Business Premises, etc. and the Danish Public Housing Act, tabled on 12 December 2012]