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The New Housing Act Finally in Serbian Parliament

The New Housing Act Finally in Serbian Parliament

Serbia
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The new Serbian Housing Act is a long-awaited codification of all the statutes pertaining to housing. The Building Maintenance Act and Housing Act were passed in its original texts more than two decades ago, and were rendered obsolete by the changes in society and economics climate. But the big question is – will there be enough funds for carrying out all the ideas laid out by the legislators?

The new act covers three areas – maintenance and management of buildings, the usage of housing units and social housing.

The system of maintenance and management of buildings has basically not been changed since the socialist times and state-run economy. The owners of the units will elect among themselves the president of the tenants’ association who shall be responsible for running the day to day operations of the building.

The first change is in terminology only. The name of the tenants’ association is now the housing community, and its president is now called manager, but the responsibilities are basically the same.

The first major change is the introduction of a possibility for the housing community to have a professional manager. A professional manger has to have a license issued by the Chamber of Commerce and shall be hired by a company which will in turn have a contract with the housing community. This will provide a significant business opportunity for companies providing both management and maintenance.

The law stipulates that the collection of the maintenance fees can be delegated to the entity which collects public utilities’ fees. In Belgrade, this is the “Infostan” public company. They will charge the owners of the housing units and, in turn, transfer money, to the association’s account. In some time, this will destroy the de facto monopoly of the public company for building maintenance, because its only advantage over its private owned counterparts was the fee collection by “Infostan”.

The new law brings an eagerly awaited possibility – it enables local governments to allocate funds for subsidizing energy efficiency programs in cooperation with housing communities.

One provision has created a rather large public debate. Under the provisions of the new law, every building is required to appoint a manager – either among the owners of the units in the building or a professional one. If the housing association does not comply, the local government will appoint a professional manager. The ratio behind this provision is to have a person responsible for management and maintenance in every single building, which has been a great problem in the last decades.

One problem which is not solved by the new act is eviction. It has been a problem for a long time – an ever-going conflict of jurisdictions between local government and courts. In theory, the local government is responsible for evictions of persons that occupied the housing units by force or when the legal title expired, became void or is nonexistent. In practice, local government interprets the nonexistence of legal title very narrowly and only deals with forcible taking of flats. All other cases are transferred to courts where they dwell for a long time. The new act has not changed these provisions, so it is likely that this situation will remain the same.

The act also put in a new position the so called protected tenants (persons living in privately owned flats at least since 1973), as well as persons living in flats nationalized from foundations which have been revived since the 1990s. The previous act set the deadline for flat owners to apply for public funded displacement of their tenants until 1993, so hundreds of families – both the owners who missed the deadline and their tenants – have been left in a legal limbo. People living in foundations-owned flats only had the right to continue living in the flats with a controlled, below market-value, rent.

All the people still living in these units have been deemed as “persons without a suitable flat” and are now eligible for displacement financed jointly by the local government and national budget. The deadline for submitting the displacement request is set for 6 months after the Act comes into force.

The provisions on public housing are much more elaborate than under the previous Act that dealt with this matter. However, the key problem are the funds needed for carrying out these provisions, which will be declining if the adequate budget appropriations are not provided, especially in the local governments’ budgets.

To sum it up, the new Act brings some badly needed and belated updating in the management and maintenance of the buildings. In other areas, changes are not so revolutionary and will ultimately depend solely on the availability of public funds.

By Dusan Dincic, Senior Associate, SOG / Samardzic, Oreski & Grbovic

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