Top 10 things You Need to Know About Ethiopia’s New Proclamation on Housing Rent Controls

 

 

The new proclamation on housing rent controls will come into force after June 8, 2024. It is intended to apply to all residential home rent contracts throughout Ethiopia. You can find the Amharic text to the proclamation 1320/2016 here.

10 Key Provisions:

  1. Registration of Rent Agreements:

    Both landlords and tenants are required to register their rent agreements within 30 days of entering into the agreement.

  2. Minimum Lease Period:

    Rental agreements must be for a minimum period of two years.

  3. Pre-existing Agreements:

    Contracts made before the proclamation’s effective date will still be governed by the new rules.

  4. Transfer of Ownership:

    If a residential property is sold, inherited, or transferred through other means, the new owner can only terminate the existing rental agreement after giving the tenant a six-month notice.

    If the property is transferred through donation, the transfer cannot be a reason for terminating the rental agreement.

  5. Rent Increases:

    Rent increases are restricted and can only occur once a year with governmental approval, provided the economic situation justifies the increase.

  6. Rent Stabilization:

    Once registered, the rent price must be maintained for that residence, even if the contract is terminated and a new renter takes over.

  7. Advance Payments:

    Landlords cannot ask for prepayment of more than two months’ rent.

  8. Payment Methods:

    All rent payments must be made through bank or electronic means. Authorities have the power to request proof of such transactions from both parties.

  9. Termination of Agreements:

    Rental agreements can be terminated by mutual consent or by giving notice.

    Tenants can terminate the agreement by providing a two-month notice.

  10. Landlord’s Rights to Terminate Without Notice:

    Landlords can terminate the agreement without notice if:

    • Rent is late by more than 15 days for the first time or more than 7 days if late multiple times.
    • The property is used for business or purposes other than intended.
    • There is a disturbance of peace and security.
    • Criminal acts are committed in the house.
    • There is intentional or negligent serious damage to the property.

 

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