Home Rentals Property rentals and unusual terms.

Property rentals and unusual terms.

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Generally, the owners of properties in Spain and their tenants do not have the knowledge on what might appear on the rentals contracts and that people might include clauses that have no validity.

The requirements and conditions shown in the rental contracts are known as legal clauses and they are set by the Spanish law.

The regulating setting of the rentals shows that some rules included in the contracts are actually illegal.

The edition of the rental contracts must be adjusted to a valid rule and their supervising must be held by a solicitor specialized on this type of documents.

That is why, it is important for both the owner of the property as for the tenant, that the rental contract must be supervised by an expert solicitor.

As the matter of fact, Costa Invest Real Estate counts with a Legal Department that deals with the edition of the rental contracts by applying the valid law of Spain.

In the same time, those rental contracts are offered in different languages, both for the tranquility of the owners as for the tenants.

An incorrect rental contract or a contract with illegal clauses which should not be included on might bring problems of different kinds, both for the tenants as for the owners who rent their properties.

In order to avoid problems derived from the rental of properties, the first step is to count with a proper rental contract which must adjust to the legal setting in Spain.

Clauses on the rental contracts in Spain.

Long term rental contracts imply that the tenant signs a contract for a whole year. In other words, the tenant has to stick to the contract and rent the property for the entire year.

However, the reform of the Law of Property Rentals from 2013 brings the contrary and states that the tenant has the right to give up the contract after 6 months from signing it.

The law says also that a tenant must pay the whole amount to the owner if he wants to leave the property after 6 months of renting it.

In order the penalty to be effective, it must always appear on the contract. If not, the owner has no right to ask the tenant for any penalty.

There is also another clause in Spain that says the owner of the property can access his house whenever, even if rented out.

The real target of that clause is that the owner can access his property in order to make inspections or status revisions of the house. This clause is absolutely illegal and anti-constitutional according to the Spanish laws.

Spanish Constitution recognizes the immunity of a house in the art.18 and it states that the owner can access the property only after the consent of the contract´s title holder, or through a court order.

The article says it all very clear:

“A home is impregnable. No entry or search can be done inside it without the consent of the title holder or after a court order, unless there is the case of a flagrant crime”.

Moreover, when included in the contracts of rental in Spain, this clause offers guarantees for the owner of the rented property, in case the tenant would not leave the house after finishing the contract.

In those circumstances, the owner of the property for rent must always turn to the competent justice and report the tenant of his property by law if the contract has finished and the tenant does not want to leave the property. In Spain this is known as ¨the throw¨- when a judge determines the evacuation of a tenant from the property.

Another clause that is usually included in the rental contract in Spain, especially in those contracts which are not supervised by a solicitor, is that a tenant can extend the rental contract.

Created especially for the rental contracts for long term, the law says:

“the length of the rental will be freely discussed between the two parties. If the length is less than 3 years, by the ending of the contract, the latter is renewed obligatory every year, until the rental gets to the total length of minimum three years, unless the tenant informs the owner about not renewing the contract. The owner must be informed about it 30 days in advance”.

This law shows clearly that the renewal of the rental contract is obligatory for the owner and voluntary for the tenant. There is only one exception of the previous aspect: the owner can inform the tenant that he needs his property back but only after one year of rental.

Rules for renting a property in Spain.

The law 4/2013 on relaxation of laws relating the market of properties for rent became valid in June 2013. This law modified the Law of Urban Renting from 1994.

The target of the new law is to promote and make flexible the market of rental properties in Spain.

These are the main changes made on the new Law of relaxation and development of the rental properties in Spain:

  • Property rentals for touristic and holiday purposes.

The actual valid law of rentals in Spain excludes the properties rented for holiday purposes.

Rentals for holiday purposes, also known as “short term rentals” are regulated by a specific regulation.

By default, the system for term rentals should be applied to these rental properties, but the former has not suffered any change.

  • The right of the owner to take back his rented property.

The valid law on rentals in Spain recognizes the owner´s possible causes of necessity, when the owner needs it back to live in it, like a first residence. However, these details are not obligatory to appear on the contract.

After the passing of a rental year and after informing the tenant of his necessity (two months in advance), the owner has the right to take back his property.

  • The minimum length of a rental contract is reduced from 5 to 3 years.

The rental length can be freely discussed between the two parties, between the owner of the property and the tenant.

If the rental contract is less than 3 years, by last day of the contract, the latter will obligatorily be renewed every year up to three years, unless the tenant expresses his wish of not renewing it, but always 30 days in advance.

  • The tenant can leave the property after 6 months.

The above modification on the law of rentals in Spain brings the right of the tenant to leave the property only after 6 months from the signing of the contract, even if the latter was signed for a larger period.

The tenant must notify the owner of the property 30 days before.

By mutual agreement, the owner and the tenant can add a clause in relation to the previous aspect on the contract, saying that the tenant must pay the owner the equivalent of a rental month.

That amount must be the equivalent of a rental month for the rest of the years that the tenant will not rent by breaking the contract.

If the contract is made for a smaller period of time, less than a year, a proportional part of the compensation for the owner is calculated.

  • The unspoken renew passes from 3 to 1 year.

If the deadline of the 3 years of renting has passed and none of the parties expressed their renewal, the contract will be automatically renewed for one year more.

  • Modification of the rental price.

In the cases of long term rentals, for more than one year, both parties should decide on the rental price.

That amount can only be updated at the end of the rental contract and the rental price will be updated by adding the percentage variation updated by the general national index of the consumption price.

Costa Invest Real Estate offers a personalized legal advice service to its clients, both to the owners who want to rent their properties as to those who want to enjoy their holidays in Orihuela Costa.

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