The Spanish Civil Code devotes an entire title to rental contracts, beginning as follows: “Leases may be for things, works, or services.” With this opening statement, the legislator makes it clear that leases go beyond real estate, extending to works and services.
The most common type of lease, of course, is for residential properties, commercial premises, or, as indicated in the Civil Code itself, rural and urban land. In this post, we will focus a little more on residential leases, to clarify any doubts you may have about this type of contract.
Technically, a lease agreementis a legal contract that regulates the transfer of use of a property. This agreement is made for a specific period of time and, in exchange, rent must be paid.
Put simply, it is an agreement signed by two parties who wish to enter into a contract and clearly set out their terms and conditions in writing. The landlord and tenant must discuss and clarify what they want from each other, without violating the provisions of the law.
Even though a lease agreement can sometimes feel like a gamble—since you may not fully know the tenant—it must be put in writing. The benefits are usually mutual, as the contracting parties clearly set out their intentions and the circumstances under which they are entering into the agreement.
Among the benefits are:
A lease agreement is specifically intended to clearly set out all the terms agreed upon by the parties during the negotiation, and both must comply with them. Likewise, neither the landlord nor the tenant may modify these conditions to the detriment of the other party for the duration of the signed agreement.
This signed agreement is binding between the parties, and they are obligated to comply with its terms, provided there is mutual respect for the lease relationship. Finally, this contract serves to demonstrate the terms agreed upon in the instrument in the event of any unforeseen circumstances.
Certainly, this type of signed agreement requires compliance with certain legal provisions to safeguard the rights and interests of those involved. The drafting of the agreement can be summarized in three basic points, namely:
Include the clause for repossession of the property due to necessity:
According to the most recent reform of the Urban Lease Law (LAU), which governs urban leases, a clause providing for this circumstance must be included. This requirement may apply to the landlord, their children, parents, or spouse, in the event of a possible separation.
Rent update:
It is important to include a clause establishing an agreement between the parties to review the rent one year after the agreement is signed, in accordance with the CPI. In the absence of this agreement, the agreed rent cannot later be increased, which serves as protection for the landlord.
This situation arises when the tenant decides to leave before the end of the agreed term, thereby subjecting the landlord to potential damages. This clause must be included and is based on Article 11 of the applicable law, allowing you to claim compensation from the tenant.
¿What documents do I need to sign a lease agreement?When signing a lease agreement, whether you are the landlord or the tenant, you must have certain mandatory documentation in order to formalize the rental agreement. Among the documents, the parties must have the following on hand:
In short, a lease agreement can be drafted by a lawyer, preferably, although it can also be done by a real estate agency or even by yourself. However, if you do not have sufficient legal experience, it is always advisable to use a free template or model lease agreement.
There will always be doubts, especially if you are unfamiliar with this type of negotiation. The decision to hire the services of a lawyer or a real estate agency is something that should be discussed and agreed upon by both parties.
A signed rental or lease agreement is legal if it complies with the requirements established by current legislation, such as:
You must provide a valid address; it cannot be the rented property, where you can be located.
It must include the company’s registration details and the identification of the authorized signatory, along with the power of attorney authorizing them to act.
Regardless of whether it is intended for residential or commercial use.
And among the tenant’s obligations, they must remain in the property for between six months and one year.
This must be in line with the price of the property.
Finally, it should be noted that old rental contracts are subject to a special regime, and their requirements are different.
In Spain, it is not mandatory to have a lease agreement notarized or registered in the Property Registry. It is sufficient for the parties involved to draft a private document, either digitally or on paper, sign it, and it will be fully valid between them.
Ultimately, this agreement signed between private individuals is fully valid without having to comply with any additional formalities beyond those legally required. However, if you need more information or have any questions, it is best to contact a professional expert in the field and clarify any issues before signing.
At the Property Registry, to formalize a lease agreement, you must first go to a notary, who is responsible for validating and certifying it. Once this is done, the tenant must go to the Property Registry to request registration of the contract, thereby completing a legal formality.
Remember that it is not necessary to go to the Land Registry office, as a private contract is just as valid as a legally formalized one. It is simply a matter of discussing it with your tenant and deciding what is most convenient for both parties.
Rent-to-own makes drafting the contract somewhat more complex, as it must clearly define two legal subcontracts: a lease and a purchase agreement, so that the tenant can live in the property for a specific period of time.
However, once the term ends, you will have the legal option to purchase the property and deduct, in whole or in part, the rental payments. Since these are two subcontracts, the lease must be governed by the Urban Lease Law for the duration of the lease agreement.
On the other hand, the regulation of a home purchase agreement must be governed by the provisions contained in the Civil Code.
According to experts, here is what you should review before drafting a lease agreement:
At Domoblock, you can invest in outstanding properties easily and securely, with the best market opportunities to diversify and grow your assets. A team of real estate experts supports you every step of the way, offering advice and guidance to help you achieve your financial goals.
Start investing in Domoblock with a minimum investment of €200 and earn returns of 10% in less than 8 months. Secure your finances and enjoy peace of mind while your wealth grows with Domoblock.
You have now seen how to draft a property lease agreement, the legal requirements, and the formalities you must comply with as a landlord. If you own a property and are considering renting it out, do not do so without seeking advice from the experts at Domoblock.
.png)
.png)
.png)
.png)
.png)
