Bankers Ask to Let Landlords Reset Rent for New Tenants in CDMX

Mexico’s bankers want Mexico City’s proposed rent law changed so that landlords can agree a new rent freely when one lease ends and a different tenant moves in. The Asociación de Bancos de México (the Mexican Bankers Association) delivered its proposals to local lawmakers from the PAN (National Action Party), El Universal reported on Nov. 8.

The bill under debate is the Ley de Relaciones Inquilinarias y Rentas Justas, Razonables y Asequibles (roughly, the Law on Tenant Relations and Fair, Reasonable and Affordable Rents), sent to the city’s Congress by Clara Brugada, the jefa de Gobierno (Mexico City’s mayor). The bankers’ comments cover rent increases, a digital registry of leases, the guarantees landlords can demand from tenants, and the powers of new government offices the bill would create.

What the banks propose on rent increases

The bankers would keep the bill’s limit tying rent increases to inflation while a lease is running. Once that contract ends and the owner signs with a different person, they argue, landlord and tenant should be free to set a new price between themselves. In practice, the inflation cap would protect a sitting tenant but would not carry over to the next one.

Lease registry, deposits and new offices

The bill sets up a Registro Digital (digital registry) for rental contracts. The banks ask that registering a lease there serve statistical purposes only, so that an unregistered contract would still be legally valid.

They also want more flexible rules on the guarantees tenants are asked to provide and on brokerage fees. Two new bodies in the bill would have narrower powers under their proposals: the Defensoría de las Relaciones Inquilinarias (an ombudsman office for landlord-tenant relations) and the Gabinete de Acompañamiento Social ante Desalojos (a social support team for evictions). The bankers asked that both offices’ authority be clearly limited.

The bankers’ case: small landlords with mortgages

The banks frame their objections around middle-class families who took on long-term mortgage debt to buy a home, rent it out while paying the loan, and later use it for retirement income, extra earnings or an inheritance for their children. If the new rules cut or make uncertain the rental income those owners expect while their mortgage payments stay the same, some could face more strain on household finances, the bankers wrote.

What it means for renters and owners

For anyone renting in Mexico City, the bankers’ main request would change what happens at the end of a lease. A tenant who stays would keep the inflation limit, but a new tenant moving into the same unit would pay whatever price the owner and that tenant negotiate. A registry with no legal weight would also mean an unregistered lease could not be challenged on that ground alone. The bankers’ proposals are suggestions to lawmakers, and the bill itself is still under review.

What PAN lawmakers say

Olivia Garza, a PAN deputy in the city’s Congress, said a reform this large has to hear every sector involved. She said the right to housing should be protected while the city also keeps and expands the supply of rental homes, and she added that the city government itself carries the main duty to guarantee that right.

“We have to seriously review the economic and legal effects of this initiative,” Garza said, according to El Universal. She called for an assessment of how the rules would affect owners, tenants, financing and the availability of housing.

What happens next

Garza said the observations will go to the committees drafting the opinion on the bill, known as comisiones dictaminadoras, so they can weigh them during their review. No date for a committee or floor vote was given.

Source: El Universal