- Published on 01 May 2025
Calls to deregulate Old Rent go back to the 1970s. By the early 1990s, these calls grew stronger, leading to Law 4/1996, which allowed only new contracts to be made under the mainstream Civil Code and left prices and terms to be decided by landlords. However, to the dismay of old landlords, the new law did not decontrol existing Old Rent contracts. While this was the practice with neoliberal rental developments across the globe, landlord demands for decontrol persisted, and court cases continued to be lodged.
In this study, which is part of a series dealing with the Supreme Constitutional Court’s ruling rent control of the Old Rent law, we compare previous experiences of old rent liberalisation, whether through laws that have already been applied to agricultural land, commercial units, and legal persons’ contracts, or through a number of prominent liberalisation proposals that have been put forward over the decades. This is in order to present the most important points that should be considered in the upcoming legislative amendment, and to benefit from past experiences and avoid their pitfalls.
Contents
Historical Context: Why Did It Take 40 Years?
Evaluating past experience and attempts at decontrol
Component 1: Initial Jump in Rental Values
Component 2: Transition Periods
Component 3: Annual Rent Increases
Component 4: Safeguarding Low-Income Tenants
Appendix 1: Table comparing enacted laws and key proposals decontrolling Old Rent
Historical Context: Why Did It Take 40 Years?
The recent constitutional court ruling on old rent comes after more than four decades of government hesitancy. Successive administrations repeatedly avoided reforming the old rent system, fearing mass displacement and social unrest. The law had long been viewed as a crucial safety net for low-income and elderly tenants, many of whom would be unable to afford market rents. However, the sharp inflation of the early 1990s left old rents entirely disconnected from market realities, deepening tensions between landlords and tenants.
In 1996, amid broader neoliberal restructuring, Minister of Housing Salah Hasaballah introduced the “New Rent” law, vowing to leave old rent contracts untouched, citing the risk of mass eviction and unrest. While Hasaballah even blamed urban deterioration on the Old Rent law, sarcastically noting that tenants paid less for rent than for garbage collection due to rent freezes under inflationary conditions, state officials hoped that the new rent law alone would resolve the housing crisis without the political cost of altering existing contracts. He argued that New Rent regulation was necessary to “cool down” the overheated housing market, especially as austerity policies were forcing the state to retreat from providing affordable housing. He linked the housing crisis to the state’s inability to directly develop and maintain housing stock due to constrained public finances, noting that the privatization of the housing sector and unregulated home prices left the state powerless to build affordable housing at scale.
The 1996 deregulation rent policy was promoted as a solution that would, within two years, dramatically expand housing supply, stabilize rent prices, and boost investment in real estate. However, reality fell short. While landlords did gain more favorable conditions for new rental contracts, the market remained skewed. Affordable housing continued to shrink, with inflation outpacing wage growth and the formal housing market increasingly catering to upper-income groups. For three quarters of the population, the informal housing sector remained the primary source of affordable shelter.
Since 1996, the rental market has operated under two parallel systems: Old Rent, which had fixed rent prices for contracts made from the 1940s to 1996 while allowing generational bequeathal, and New Rent from 1996 onwards, which leaves prices to market forces and limits terms to a few years. This duality has fueled growing frustration among landlords bound by Old Rent contracts while deepening the anxieties of tenants unable to afford deregulated market rates.
Evaluating past experience and attempts at decontrol
For years, several old rent liberalisation laws have been applied to non-residential units, and several proposals to liberalise residential units have emerged, but have not been passed. We found three laws that liberalised rents, namely: Law 96/1992, which targeted agricultural lands, Law 6/1997, which partially liberalised commercial units, and Law 10/2022, which dealt with real estate units leased to legal persons (companies or institutions). Other notable proposals include a proposal by the Housing Division of the National Specialised Councils affiliated to the Presidency of the Republic, written by the late housing expert Dr Abu Zeid Rajeh in 1997, a recent proposal submitted by the Egyptian Society for Political Economy to the House of Representatives in 2021, a proposal by the Egyptian Tenants Association, which represents a number of old rent tenants, and a recent proposal by the Old Rent Landlords Union published after the recent Constitutional Court ruling, which also represents a number of property owners renting under the old rent law.
By comparing these laws and proposals, four main components emerged that were common across most of them (Appendix 1). The first component is an immediate increase in rents to absorb a percentage of the difference between fixed rents and market values. The second is to provide for a transitional period between the immediate increase and the full liberalisation of rents. The third is a gradual increase in rents during the transitional period. The fourth component is support for tenants who are unable to afford the new market prices. The laws and proposals clearly differed in their treatment of the four components, especially the laws that were passed, which gives the opportunity to benefit from previous experiences and pave the way for a well-studied decontrol of old rents that protects the most vulnerable parties.
Component 1: Initial Jump in Rental Values
The laws and proposals approach initial rent increases quite differently. Law 96/1992, which targeted agricultural land, set rent at 22 times the value of the real estate tax upon ratification. If the tax was frozen at a nominal EGP 2, a committee would intervene to reassess the rent. Meanwhile, Law 6/1997, addressing commercial units under old rent contracts, implemented steep multipliers depending on the unit’s construction date, ranging from a ten percent hike for units built post-1977 to an eightfold increase for those built before 1944. Law 10/2022, affecting juridical persons, mandated a uniform fivefold increase in rent at the time of enactment. Similarly, the Landlords’ Union 2025 proposal for housing units suggests an increase to 60% of the real estate tax assessment in year one, rising to 80% in year two, and then 100% in year three. Drawing on Law 6/1997, the 1997 Proposal also relied on a tiered multiplier, although slightly less aggressive than Law that of 6/1997. The 2021 Draft suggests an initial recalculation of rent to a minimum of either EGP 200/300, or the prior year’s average utility expenses, or 75% of the tax-assessed value—whichever was higher.
The importance of the immediate increase lies in giving some balance between the fixed and declining values and the new market values, which may be a hundred or a thousand times higher than the old values. But there is also difficulty in estimating this increase in a direct and simple way that does not require discretionary powers that may be tainted by corruption or burden the courts with appeals, while at the same time not burdening tenants with unbearable costs. Therefore, we urge that the greatest effort be spent on this component to ensure a law that balances the rights and duties of both parties, to minimise the outbreak of disputes after its passage.
Component 2: Transition Periods
Law 96/1992 instituted a strict five-year period after the law was enacted and the rents were raised, before contracts were fully decontrolled. If tenants did not agree to the rent and terms proposed by landlord at the end of the 1996/1997 agricultural year, the contract would be effectively annulled. Law 10/2022 also instated a fixed five-year transition, after which the tenant was required to vacate the premises.
Moving to the proposals, the 1997 draft offered the most structured and extended transition. It consisted of two phases: the first featured annual rent increases based on the unit’s age, and the second standardized rent based on property value over five years. Depending on construction date, the full transition period ranged from 15 years (for the oldest buildings) to 25 years (for those built just before 1996).
The 2021 Draft did not provide a detailed transition timeline but built-in safeguards to delay eviction unless specific conditions were met including, unit vacancy, ownership of another property, or contract age exceeding 50 years, which arguably would put pensioners in a very difficult position. In contrast, the Landlords’ Union 2025 proposal was the most aggressive, aiming for full rent liberalization within three years. The Egypt Tenants’ Union proposal implicitly allowed for a 15-year horizon.
The importance of the transition period lies in giving tenants enough time to find alternative housing if they are unable to afford market values after the end of the period. It also allows the government to set up a programme to support those who find rents unaffordable, both during the transition period and afterwards, and gives the House of Representatives an opportunity to study the legislative impact of the New Rent law and work to reform it to regulate the mainstream rental market, which has left tenants at the mercy of deregulated prices, facing difficulty in affordability of housing across Egypt.
Component 3: Annual Rent Increases
Some laws and proposals imposed no annual increases during the transitional period, after the initial increase was made, such as Law 96/1992 on agricultural land. In contrast, Law 6/1997 and the 2021 draft both set a flat 10% annual rise. Law 10/2022 went further, requiring a 15% annual increase for five years.
The 1997 Proposal was more nuanced. In its first phase, it applied different annual increases depending on when the unit was built. For instance, the oldest units (pre-1944) faced a 20% annual hike for five years, then 10% annually. Newer units received uniform 10% increases. The logic for this was to account for the likelihood of newer tenants having paid khiliw (key money) to acquire their units and also to absorb the differences in rental values of units whose rents were frozen since before the 1950’s (at single digit rents i.e EGP 6) and conversely those rented in the 70’s and 80’s (with rents upwards of EGP 100). The second phase shifted the rent calculation to be based on a percentage of the property’s market value; starting at 4% and capping at 8% by year five. The Egypt Tenants’ Union proposal was more modest: a 10% annual increase for five years, followed by a five-year freeze, and then another 10% bump.
This study believes that these gradual increases should be calculated in an equation with the immediate increase, in a way that balances between a common sense immediate increase and annual increases within the limits of wage increases, in order to take into account the Constitutional Court’s ruling on the unconstitutionality of rent stabilisation, while not burdening tenants with increases they cannot afford.
Component 4: Safeguarding Low-Income Tenants
Here, the differences are stark. Law 96/1992 included several unique protections. If a landlord wished to sell before the five-year term ended, they had to pay 40 times the real estate tax annually as compensation to the tenant. In eviction cases, the compensation rose to 200 times the tax value. If the land also housed the tenant, eviction could not occur unless the government first provided alternative housing in the same area. This provisio n was not wholly applied, where evicted tenants were given priority in the Mubarak Kharigin (graduates’) desert land reclamation project implemented in a number of remote locations.
Despite ending the stipulated transition period in the liberalization of rent, the 1997 Proposal was notably tenant-friendly. It envisioned a social housing fund, a rent-to-buy option, and an agency to mediate landlord-tenant disputes. It also protected tenant inheritance rights during the transition, required 3–5 years’ notice for demolition-related evictions after the transition period, and proposed caps on the number of evictions per year. It also called for state monitoring of the housing market to prevent speculative disruptions. The 2021 Draft similarly proposed a state-supported fund financed by abolishing real estate tax exemptions on rental units. It also gave eviction protection unless specific conditions were met and granted low-income tenants priority access to social housing. The Egypt Tenants’ Union focused more on rent stabilization rather than comprehensive protections.
We find that the 1997 proposal of the Specialised Councils is the strongest in supporting low-income tenants, between cash support and protecting those who are unable to afford decontrolled rents from eviction and homelessness. It is also the closest to implementation, as there is already a Social Housing and Mortgage Finance Fund, which implements a programme with the World Bank that provides cash subsidies for the purchase of social housing units, as well as a component that provides cash support for private sector tenants. All that is required is to activate this component to cover all low-income tenants, especially those who are on a pension.
Conclusion
The long and complex history of rent control reform in Egypt reflects deep structural contradictions in the country’s housing policies and political economy. Since rent liberalization, the old rent regime was preserved not only as a form of social protection by proxy in the absence of affordable housing alternatives, but more importantly the government as well as parliament, avoided this long-term cobweb in fear of unleashing social unrest. Successive governments have repeatedly promised to address housing shortages, unlock vacant units, and restore balance to landlord-tenant relations. Yet the persistence of housing informality, the deterioration of social protections, and the stark gap between market prices of rents and units for sale, and household incomes, continue to increase socioeconomic gaps.
The varied proposals and laws examined in this article—from aggressive liberalization models to more phased, socially sensitive frameworks—underscore competing visions for how Egypt should transition out of the old rent system. In light of the recent Supreme Court ruling, the challenge lies not in whether rent control should be reformed, but in how to ensure that reform does not come at the cost of widespread displacement and deepened inequality. Assessing previous implementations of decontrol legislation, as well as drafts for housing rental decontrol reveal important lessons for legislators. Given the gravity of decontrol and its indisputable impact on millions of tenants, a sufficient transition period with gradual, proportionate rent increases is essential to prevent immediate socioeconomic shock. Just as crucial are carefully designed, nuanced social protections, particularly for pensioners and low-income households, who will be the most affected by the repercussions of decontrol and must be shielded from its harshest impacts. These considerations form the foundation of identifying clear, actionable policy recommendations to guide a socially just and sustainable pathway for rent reform in Egypt.
Acknowledgements
Written by: Nadine Abd El Razek and Yahia Shawkat
Main image: Downtown Cairo, BEO
Please cite as:
Nadine Abd El Razek and Yahia Shawkat. Evaluating Old Rent Decontrol – Lessons Learnt. The Built Environment Observatory. 29 April 2025.
Appendix 1: Table comparing enacted laws and key proposals decontrolling Old Rent
| Laws and Proposals | Initial Jump in Values | Annual Increase in Rents | Transition Period & Aftermath | Safeguards for Low-income Tenants |
| Abolishing Rent Control on Agricultural Land Law (96/1992) | Rent will be set at 22 times the real estate tax OR if the real estate tax is frozen at EGP 2 then a committee determines the appropriate rent, at the request of the landlord.This increase will be enacted for the duration of five years. | None | If the tenant and landlord do not agree on the value of rent by the end of the 1996/1997 agricultural year (5 years after) then the rent contract is automatically annulled. | -If the landlord would like to sell the property prior to the end of the five years then they must compensate the tenant with an amount equivalent to 40 times the real estate tax per year.
-If an eviction order is issued, the landlord is obliged to compensate the tenant with 200 times the real estate tax -If the agricultural land also serves as the home of the tenant and an eviction notice has been issues, the state is obliged to provide alternative housing in the same area. The tenant cannot be evicted prior to being provided adequate housing. |
| Partial decontrol of commercial units under (Law 6/1997) | -10% increase for units built between 9/9/1977 and 30/1/1996
-Threefold increase for units built 7/10/1973 and 9/9/1977 -Fourfold increase for units built between 5/11/1961 and 6/10/1973 -Fivefold increase for units built between 1/1/1944 and 4/11/1961 -Eightfold increase for units built before 1/1/1944
|
10% annual increase | ||
| Abolishing Rent Control on Juridical Persons (Law 10/2022) | An immediate fivefold increase in the value of rent at the time of the law’s ratification | 15% annual increase for five years | After the five years expire, the tenant is obliged to vacate the property | None |
| National Specialised Councils Proposal, 1997 | Increase:
-10% increase for units built between 9/9/1977 and 30/1/1996 -Twofold increase for units built 7/10/1973 and 9/9/1977 -Threefold increase for units built between 5/11/1961 and 6/10/1973 -Fourfold increase for units built between 1/1/1944 and 4/11/1961 -Fivefold increase for units built before 1/1/1944
–Vacant units: contracts are annulled if units are permanently vacant due to tenants living abroad |
Phase I:
-Units built between 9/9/1977 and 30/1/1996: 10% annual increase -Units built 7/10/1973 and 9/9/1977: 10% annual increase -Units built between 5/11/1961 and 6/10/1973: 10% annual increase -Units built between 1/1/1944 and 4/11/1961: 15% annual increase for five years and then 10% annual increase -Units built before 1/1/1944: 20% annual increase for five years and then 10% annual increase
Phase II for all units: -Year 1: Annual rent should not surpass 4% of the unit’s value -Year 2: Annual rent should not surpass 5% of the unit’s value -Year 3: Annual rent should not surpass 6% of the unit’s value -Year 4: Annual rent should not surpass 7% of the unit’s value -Year 5: Annual rent should not surpass 8% of the unit’s value |
Allows for a rent to buy scheme throughout the transition period, which is determined according to the year the unit was built. The transition is twofold; Phase I, which varies in duration according to year built, features a gradual increase based on current rent prices and Phase II, which is a fixed five years for all units, afterwhich rent is liberalized. This is the total transition period based on year built:
-Units built before 1/1/1944: 15 years -units built between 1/1/1944 and 4/11/1961: 18 years -units built between 5/11/1961 and 6/10/1973: 21 years – units built 7/10/1973 and 9/9/1977: 23 years -units built between 9/9/1977 and 30/1/1996: 25 years
|
-Social housing fund: To support low-income tenants who cannot afford rent after increases, paying for the difference between what they can afford and the new rental value. This will be funded by real estate taxes, which will increase with the rent hikes and should be reviewed every five years.
-The rental contract does not end during the transition period if the tenant passes away, instead it passes on to their next of kin. -Establishment of an agency dedicated to resolving disputes between landlords and tenants. This will mitigate having to resort to the judiciary. -If after the transition period the landlord of a property wishes to demolish the building the must give tenants at least a 3-5 year notice. -The state should put an annual limit on number of evictions to mitigate widespread displacement. -The state should monitor the free housing market and interfere legislatively when needed to prevent turmoil. |
| Draft submitted by the Egyptian Society for Political Economy to parliament, 2021 | Minimum rent for residential units to increase EGP200 and for non-residential units the minimum amount is EGP 300 OR the average utility expenses paid in the previous year OR 75% of the value upon which the real estate tax was calculated in the previous year | 10% annual increase | Landlords cannot evict tenants except in one of the following cases:
-The unit has not been occupied for three years -The tenant, their spouse or underage children were issued a building license at least three years before or were granted a residential unit in one of the state’s social housing projects -The rental contract is 50 years old |
-A state-supported fund will be established to support low-income tenants who are unable to afford new rental values. Real estate taxe exemptions for rental units will be abolished and the funds pooled through these taxes will feed into the newly established fund.
-Low-income tenants will be given priority in state social housing projects. -Special committees will be established to resolve disputes over rental values |
| Landlords’ Union Recommendations, 2025 | An immediate increase of 60% the value determined by the real estate tax | – 2nd year increase to 80% – 3ry year increase to 100% increase – 4th year fully liberalizing rent | ||
| Egypt Tenants’ Union Recommendations, 2025 | 10% annual increase for five years then a five year pause on increases followed by another 10% increase |