New rental law: Keep your fingers off the maintenance money

With a new and modernized Rent Act, the Greenlandic Government will prevent money paid in and set aside for the maintenance of a property from being used to cover a potential operating deficit.

A deal with the enormous maintenance backlog of several billion kroner has been initiated with a new law that has been submitted for consultation and is a particularly important element in a major housing reform.

- The bill should be seen as a central element in the implementation of the housing reform and in the work to create a more transparent, up-to-date and coherent legal basis for tenancy in Greenland, according to the proposal for the new Rent Act.

Patterns

The current Tenancy Act has been the subject of so many legislative adjustments and patchwork solutions over time that it was more than time for the Tenancy Act to be rewritten and updated.

In many areas, there is not much innovation in the new Tenancy Act, as stated in the presentation for the consultation material, but in one area in particular, there is a clarification and tightening that can overcome the challenges of the large renovation backlog.

In paragraph 16, it is emphasized that money paid for maintenance of the home must be reserved for the actual purpose and may not thus be used to cover any operating deficits.

The comments to the Act state the following under paragraph 16:

The Modernisation

The draft for the new and very comprehensive Tenancy Act explains the prior legal work:

- The bill implements a comprehensive rewrite and modernisation of the tenancy legislation. The basic principles of the current regulation are continued, including the separation between public and private rental housing, the rules on rent determination, maintenance, termination and cancellation, and the framework for resident democracy and the Housing Complaints Board. At the same time, the Act is updated to the current self-government system, including the actual organisation with self-government and municipally owned housing companies.

- The proposal clarifies the scope of application so that it is clear that the Act covers housing owned or rented by the Greenland Self-Government, the municipalities and companies in which these have a controlling influence, as well as private owners. A systematic and linguistic modernization of the legal text is carried out, a number of previous executive regulations are integrated into the Act itself, and clearer regulation of, among other things, the time of payment for rent, administration and planned periodic maintenance (PPV) of the public housing stock is carried out.

- The bill also means that the competence of the Housing Complaints Board will be expanded to include certain disputes in privately owned rental housing. This will ensure a more accessible and efficient conflict resolution for tenants, while at the same time creating more uniform standards for tenancy law matters regardless of ownership. The current rules for private landlords regarding rent determination, maintenance, termination and cancellation will otherwise be continued unchanged.

Ten-year plan

The new bill is based on a political agreement back in May 2024, when the then majority coalition, IA and Siumut, presented a ten-year plan that contained several sub-elements.

Also read: Ten-year agreement to end billion-kr backlog

Sermitsiaq outlined the various planned initiatives at the time in this way, based on the delicate and politically explosive issue, on which the then Greenlandic Government had reached an agreement after several years of negotiations:

Balance in the housing departments' finances - to ensure that the rent in the Government's housing stock reflects the actual costs of operation and maintenance.

New housing security scheme - to create financial security for citizens with few funds available, in connection with implementing an adjustment of the rent

Renovation efforts for the Government's housing stock - to stop the deterioration of the housing - the financing of the renovation efforts is presupposed by a rent that reflects the actual costs of operation and maintenance.

Adjustment of housing financing schemes - citizens' access to the schemes is improved, so that citizens' ability to provide housing for themselves is ensured. A special focus is desired on the possibility of improving the tenant-to-owner scheme.

Principles for staff housing - the use of staff housing must be minimized. A bill on principles and limitations of the use of staff housing must be prepared.

Reduction of the Government's housing stock - the Government must own the fewest possible housing and citizens must be supported to a greater extent in providing housing for themselves

There is a consultation deadline for the new Tenancy Act on 3 April.