The Spanish Civil Code dedicates an entire Title to the rental contract, which begins: “Leasing can be for things, or for works or services.” With this opening, the legislator implies that leasing can extend beyond real estate, encompassing works and services.
The most common, of course, is the rental of homes, commercial premises, or as the Civil Code itself indicates, rural and urban properties. In this post we will focus a bit more on residential leases, to clarify any questions you may have regarding this type of contract.
Technically, a rental contract is a legal agreement that regulates the transfer of use of a property. This agreement is made for a determined period, and in return, a fee, rent, or lease payment must be received.
Put more simply, it is the agreement signed by two parties who wish to contract, and want to clearly state their conditions, on paper. The landlord and tenant must discuss and clarify what each party desires, without contravening what is established by law.
Even though the lease agreement can often feel like a lottery due to not knowing the tenant, it should always be drawn up as a written document. The benefits are usually mutual, as the contracting parties set out their intentions and the circumstances under which they are agreeing.
Among the benefits are:
A lease agreement specifically serves to clarify all the circumstances that the parties are agreeing upon in the negotiation, and they must comply with these. Likewise, neither the landlord nor the tenant can modify these conditions to the detriment of the other party for the duration of the signed agreement.
This signed agreement is law between them, and they are bound to its content, ensuring mutual respect in the tenancy relationship. Finally, this contract serves to demonstrate to third parties the capacity held as expressed in the instrument, in the event of any unforeseen circumstance.
Certainly, this type of signed agreement requires compliance with certain legal stipulations to safeguard the rights and interests of those involved. The drafting of the signed agreement can be summarized in three basic points, namely:
Include the clause for property recovery due to necessity:
According to the most recent reform of the LAU, which governs urban leases, the inclusion of a clause providing for this circumstance is required. This necessity may be for the owner, their children, their parents, or their spouse, in the event of a separation.
Rent update:
It is important to add a clause that implies an agreement between the parties to review the rent after one year, in accordance with the CPI. In the absence of this convention, the initially agreed-upon rent cannot subsequently be increased, which serves as a protection for the owner.
A situation that arises when the occupant decides to leave before the expiration of the agreed period, subjecting the owner to an imminent loss. This clause must be added, and it is based on Article 11 of the aforementioned law, so that you can demand compensation from the tenant.
¿What documents do I need to draw up a lease agreement?When signing a lease agreement, whether you are the landlord or the tenant, you must have mandatory documentation to finalize the rental negotiation. Among other documents, the parties must have on hand:
In short, a lease agreement can preferably be drafted by a lawyer, although a real estate office or even you yourself can also do it. However, if you don't have sufficient legal experience, it's always advisable to use a free template or a model lease agreement.
There will always be questions, especially if you lack knowledge on the subject, and there are options available for those involved. The decision or process of hiring the services of a lawyer or a real estate office is something the parties should discuss and agree upon.
A signed rental or lease agreement is legal if it complies with the requirements mandated by current legal regulations, such as:
Must provide a valid address where they can be located, which cannot be the rented property itself.
Must include the company's registration details, the authorized signatory's information, and identification of the Power of Attorney granting them authority to act.
Regardless of whether it is intended for residential or commercial use.
And among the occupant's duties, they must remain in the property for between six months and one year.
This must be in line with the house's rent price.
Finally, it should be noted that old rental contracts have a special legal framework, and their requirements are different.
In Spain, it is not mandatory to draw up a rental agreement at a Notary's office or to have it registered with the Property Registry. It is sufficient for the parties involved to create and sign a private document, either digitally or printed on paper, and it will be fully valid between them.
Ultimately, you can see that an agreement signed between private individuals is completely valid without having to comply with other formalities, except those legally stipulated. However, if you need more information because doubts arise, it is best to contact an expert professional in the field and clarify everything before signing.
At the Property Registry, and to formalize a rental agreement, you must first go to a Notary Public, who is responsible for validating and certifying it. Once this is done, you and the tenant must go to the Registry to request the registration of the contract, thereby fulfilling a legal formality.
Remember that it is not necessary to go to the Property Registry office because a private contract is just as valid as a legally formalized one. It's simply a matter of discussing it with your tenant and deciding what is most convenient for your respective interests.
A rent-to-own agreement makes the contract drafting somewhat more complex because it must be done through a double or mixed contract. This means there must be a rental sub-contract and a sale and purchase sub-contract, allowing the tenant to live in the property for a specific period.
However, once this period ends, they will have the legal option to purchase it and deduct, in full or in part, the rental payments. As it involves two sub-contracts, the rental agreement must be governed by the Urban Leases Law for the duration of the rental agreement.
On the other hand, the regulation of a house sale and purchase agreement must be governed by the provisions contained in the Civil Code.
According to experts, here's what you should consider before drafting a rental agreement:
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You've seen how to create a lease agreement for a property, including the legal requirements and formalities you must meet as an owner. If you own a property and are considering leasing it out, don't do it without the advice of the Domoblock experts.
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