Egypt Daily News – The House of Representatives, during its general session today chaired by Counselor Dr. Hanafy El Gebaly, gave its final approval to a draft law submitted by the government regarding certain provisions related to the rental of premises and the reorganization of the relationship between landlord and tenant, known as the “Old Rent Law.”
Article 1 – Scope of the Law
The provisions of this law apply to residential rental properties and properties rented to natural persons for non-residential purposes, according to Law No. 49 of 1977 on the leasing and sale of premises and regulating the relationship between landlord and tenant, and Law No. 136 of 1981 on certain provisions concerning the leasing and sale of premises and the organization of the landlord-tenant relationship.
Article 2 – Grace Periods Before Contract Termination
Lease contracts for residential units under this law shall terminate seven years from the effective date of the law. Lease contracts for non-residential units rented by natural persons shall terminate five years from the effective date, unless there is mutual agreement for earlier termination.
Article 3 – Classification Criteria for Areas and Units
By decision of the relevant governor, survey committees will be formed within each governorate to classify areas with rented residential units under this law into premium, middle-income, and economic zones. Classification will consider the following criteria:
- Geographic location, including the nature of the area and the street where the property is located.
- Building standards, construction materials, and average unit sizes in the area.
- Utilities connected to properties in the area, such as water, electricity, gas, telephone, etc.
- Road networks, transportation, healthcare, social and educational services available.
- The annual rental value of properties subject to the real estate tax law (Law No. 196 of 2008) in the same area.
The Prime Minister will issue a decree regarding the rules and procedures for the committees’ operations. The committees must complete their work within three months from the effective date of this law, with the possibility of a one-time extension by the Prime Minister. The governor will publish the final classifications in the official gazette and local government offices in the governorate.
Article 4 – Value of Rent Increases
Starting from the due date of the first rent payment following the law’s enforcement:
- Rent for residential units in premium areas will increase to 20 times the current legal rent, with a minimum of EGP 1,000.
- In middle-income and economic areas, it will be 10 times the current rent, with minimums of EGP 400 and EGP 250, respectively.
Until the committees mentioned in Article 3 complete their work, tenants or those with extended leases must pay EGP 250 monthly. After the governor publishes the committee’s findings, tenants must pay any rent differences due in equal monthly installments over a period equal to that during which the differences accumulated.
Article 5 – Increase in Rent for Non-Residential Units (Commercial Use)
For non-residential units rented by natural persons, the new legal rent will be five times the current rent starting from the next due date after the law’s implementation.
Article 6 – Annual Rent Increase Rate
The legal rent specified in Articles 4 and 5 will increase annually by 15% on a recurring basis.
Article 7 – Conditions for Eviction Under the New Law
Without prejudice to eviction reasons stated in Article 18 of Law No. 136 of 1981, the tenant (or person holding the extended lease) must vacate and return the rented property to the owner at the end of the term defined in Article 2, or under the following conditions:
- If it is proven that the tenant or leaseholder has left the unit unoccupied for more than a year without justification.
- If the tenant or leaseholder owns another residential or non-residential unit that is suitable for the same purpose as the rented property.
If the tenant refuses to vacate, the landlord may request an expedited eviction order from the local court without prejudice to compensation claims if applicable.
Tenants may still file a regular civil lawsuit in the competent court, but this does not suspend the execution of the expedited court order.
Article 8 – Priority for Tenants to Obtain Alternative Units
Without prejudice to Articles 2 and 7, tenants or leaseholders under Laws No. 49 of 1977 and 136 of 1981 have the right—before their lease expires—to request allocation of a replacement residential or non-residential unit from available state-owned properties, either for rent or ownership. The tenant must submit an application along with a declaration to vacate the current unit once the new one is allocated.
Priority is given to vulnerable groups, particularly original tenants and their spouses or parents from whom the lease was extended. The Prime Minister shall issue a decree within 30 days of the law’s effective date specifying the rules and procedures for submitting applications, determining priorities, and identifying the relevant state agencies.
These agencies must present the available units and priority lists to the Prime Minister for approval, ensuring that residential units are allocated within a maximum of one year before the original lease term ends, especially for original tenants or their spouses under a valid extended lease.
Whenever the state announces available units (rental or ownership), tenants or leaseholders will have priority in obtaining them by submitting an application with a signed declaration to vacate the current unit. If demand exceeds supply, prioritization will consider the location of the unit being vacated.
Article 9 – Cancellation of Old Rent Laws After Seven Years
Without prejudice to Article 2, Laws No. 49 of 1977, No. 136 of 1981, and Law No. 6 of 1997 amending Article 29 of Law No. 49 of 1977 (regarding non-residential leases) will be repealed seven years after the new law takes effect. Any conflicting legal provisions will also be repealed.
Article 10 – Implementation of the New Rent Law Upon Publication
This law will be published in the Official Gazette and will come into force the day after its publication.
