The landlords of Egypt are weakly protected by law

The law in Egypt between landlord and landlord is NEUTRAL (The structure of the law is pro-landlord, as regards new contracts, but legal delays work against the landlord). for rent

Rents: Can tenants and landlords agree freely to rents in Egypt?

The rent of the amount may be freely agreed between the parties. If a rent has not been agreed between landlord and tenant, rentals for similar properties will be determined by reference.

The parties are free to agree on an annual rent increase schedule in the contract. These increases can also be linked to the increase in living costs by providing, for instance, that rents will increase in proportion to the annual inflation rate reported by the Egyptian Central Bank.

Mediterranean properties of Egypt

But rent increases on tenancies governed by former socialist laws No 49/1977, Law No 136/1981 or any earlier legislation are virtually impossible to obtain. These laws apply to contracts concluded before the 1996 reforms, including contracts for the original tenant's household members. When Law No. 49/1977 applies, an increase in income depends on an assessment of the official administrative value of the property, which only occurs in particular circumstances, for example, where the building height is increased or a new building has been added.

Deposits for Security

On conclusion of the contract the parties are free to agree to the deposit payable as security (one or two months is usual). In practice, tenants often need to pay rent several months in advance (often quarterly), to ensure the tenant's capacity to pay. Usually the security deposits are returned immediately after the contract has been terminated and the rental object is returned. In practice, however, the landlords often have to prove that the tenant has settled all outstanding charges (e.g. electricity and telephone) before returning the deposit.

According to the Egyptian Civil Code the loaning person is obliged to keep objects with a value of at least two years' rent in the leased property or, where a term of the contract is shorter, equal rent for the whole period. Tenants shall only be exempt from this duty if they pay in advance the full rent amount and the parties agree to this. As an alternative, the tenant can also provide other guarantees, such as a deposit payment.

The Egyptian Civil Code also provides landlords with a loyalty to moving objects owned by the tenant, in order to ensure their rights under tenancy agreements.

The maximum deposit payable by the tenant in the tenancy agreements still subject to the old laws of 1977 and 1981 is limited to two months' rent.

What rights do landlords and tenants have in Egypt regarding contract duration and expulsion?

Fixed tenancy contracts terminate at the expiry of their term without the need to provide the other party with a notice of eviction. Contracts normally last for three to five years, but the duration is not limited by law.

For a definite period, tenancy agreements do not need to be agreed. However, if the parties have agreed to an indefinite term tenancy, the term is considered equal, for example, when a rent is payable every quarter, to the period fixed for the payment of a rent. The tenancy is regarded as a quarterly tenancy. The agreement is terminated in these cases at the end of its defined term if one party serves the eviction notice on the other. For residential agreements, the notification term shall be two months before expiry of the period fixed for the payment of the rental, when the period is equal to or greater than four months. If the period is shorter, the notice must be served before the first half expires.

The parties to tenancy agreements can provide that the landlord has the right to terminate tenancy for personal use prematurely. Unless otherwise agreed, the landlord must notify the landlord during these periods.

Either landlord or tenant may for good cause terminate the tenancy before the expiry of the term. The same notice periods must also be observed in this case and the party who terminates the rental contract is obliged to reimburse the other party.

For the presence of a good cause Egyptian law requires that the tenancy be so burdensome for the party terminating the agreement that it can no longer fulfill its obligations under the lease agreement. This is the case, for instance, when the building is demolished or the tenant is forced to leave.

Egypt Holiday Homes

The parties may determine the amount in advance in the penalty clause of the lease agreement in relation to the compensation payable. In the absence of such a clause, the courts have jurisdiction to determine the compensation amount. On a case-by-case basis, the judge decides on the outstanding rent months that represent the upper limit of compensation. However, if more damage occurs or if further investigation is deemed necessary by the judge, the judge may nominate an expert to prepare a report on the situation currently facing both parties, on the basis of which the judge will determine the compensation payable.

It is important to note that agreements on tenancy under Egyptian law do not end either with the death of the owner or with the death of the owner. However, the tenant's heirs are entitled to terminate their tenancy if they cannot pay the rent or if the premises exceed their requirements.

Where a tenancy agreement is still subject to ancient laws, the landlord's termination rights are very limited. For example, in accordance with Law no. 136/1981, even after the lease agreement has expired, the landlord may terminate the contract only for good reason as specified in the law.

How effective is the legal system in Egypt?

Infringement proceedings against tenants may be extremely lengthy and tedious. However, the Egyptian courts apply tenancy laws very strictly, and court rulings on behalf of the landlord are not unusual.

In practice, it may take up to three years to collect unpaid rents and may take the same time to expel a tenant. The recent amendments to Law No 4/1996 have, however, introduced a provision benefiting the landlord. Tenancy agreements notarized in the presence of the contracting parties can operate as enforcement orders so that property owners are no longer obliged to resort to courts for enforcement of tenancy agreements. This allows the landlord to enforce the rent and to get the tenant evicted simply by using the competent enforcement agent.

The above amendments have no effect on tenancy agreements that remain subject to old legislation. Although the tenant's eviction can be requested for limited reasons according to these laws, in practice it is not worth the effort, as it only represents a very small amount of money.