New terms and conditions in housing rental contracts
In Spain, the country’s government has just passed a Royal Decree ratifying the new conditions of housing rental contracts from now on. We will explain them to you.
When it comes to renting your property, you need to be clear about the clauses that can be included in the rental contract and what the rights and duties of both the tenant and the tenant are.
In today’s blog article Ibiza Country Villas we are going to explainyou what these new conditions of rental contracts consist of.
According to the Rental Negotiating Agency these are the conditions and clauses that must be taken into account when formalizing a rental contract for a flat or a house:
1. Rental reviews
If the contract has been signed after March 5th 2019, if there is no agreement between the parties for the annual update of the rent, the annual increases may not exceed the variation of the last IPC (public index of prices in Spanish) published on the date of review.
On the other hand, the bond deposited may not be updated annually or revise the price before the end of the first year of the contract.
2. Anticipated payments (deposits)
With the introduction of this new Decree-Law, the advance payment made as a guarantee (the so-called deposit) cannot exceed two monthly payments of the agreed rent, the costs of property management and the formalization of the rental contract correspond to the lessor (in the case of a legal entity), and the rental contract cannot oblige the lessee to pay categorically all repairs to the dwelling or spills of the community of neighbors.
3. Rentals of less than one year (seasonal)
With the new Urban Leases Act (LAU in Spanish), it is possible to freely establish the duration of rental contracts, but tenants are entitled to a mandatory extension of up to five years.
This extension can even be extended up to 7 years if the landlord is a company and not an individual (i.e. if it is a legal entity).
4. Situations in the event of the sale of the property
The rental contract must expressly include the power of recovery of the home by the owner, according to the new Decree Law.
This new legislation states that leases must always be respected by the last buyers of the housing, ie, the rental contract would remain in force even changing the ownership of the rented property.
5. Time limits for terminating the contract before its completion
Under the March Decree-Law in force, in the event that it is decided to terminate or not renew the lease, the tenant must be notified four months in advance, otherwise (if the tenant wishes to terminate the contract before what was agreed), the period of notice is two months.
6. Subrogation of rent on account of death
From now on, if the tenant dies, the law establishes the possibility of subrogation of this rental contract in certain cases.
If the profiles are vulnerable (minors, disabled persons or over 65 years), the rental contract must be subrogated, not extinguished.
7. Entry permit for owners
The Spanish Constitution establishes the right to the “inviolability of the home” and, therefore, it is illegal to enter the home on a regular basis (to check its condition or other reasons).
This provision is common in many rental contracts but is totally null, void and illegal.
