When renting a property, it is necessary to establish a contract between both parties, which regulates the relationship between them, with the rights and obligations that each party has, and this document must include all the key points necessary to avoid future contractual discrepancies.
First of all, it is important to indicate what a rental contract is. It is the document that regulates the relationship between the landlord – owner, who transfers the use of his property to the tenant – tenant, who pays a series of monthly instalments for the duration of this situation; also including, as we have indicated above, the rights and obligations of both parties.
With regard to the aspects to be taken into account, marked by the regulations governing this matter, we can highlight:
The duration, this varies if the contract is signed by a natural person or by a legal entity. Irrespective of the agreement between the parties, the minimum duration of the lease contract established by law is five years or seven years respectively. In the event that shorter terms are established, these will be compulsorily extended annually up to these durations if the tenant – lessee so wishes.
The termination of the rental contract will depend on the cancellation by either of the parties; establishing, as we have indicated above, the automatic nature of the extensions until the established terms are reached; however, this cancellation is conditional on the tenant – tenant giving notice at least 30 days or one month prior to the termination of the contract; in the case of the landlord – owner, after one year of the contract has elapsed, it is subject to 60 days or two months’ notice. In the event of non-compliance with this notice, the defaulting party is liable to pay compensation to the other party, generally equivalent to one month’s rent for each year of non-compliance with the contract.
The security deposit is also an important aspect in this type of contract, which leads to numerous discrepancies between the parties. By law, a one-month deposit must be paid in the case of a residential lease, or two months in the case of a commercial lease. However, should the deposit be paid in advance? The recommendation is that no, that is to say, it should be paid at the time of signing the contract, knowing that at the end of the contract the owner-landlord has one month to return the amount.
As you can see, there are many aspects to be taken into account, apart from the basis of our contractual regime: the agreement between the parties. At LegalMed as experts in Real Estate Law we can advise you without obligation on all these aspects, when it comes to contractually adapt the lease to your needs and comply with legal requirements.