If you own an apartment and want to rent it, you will wonder what the duration of a rental contract is. What can be agreed or what is the difference between a temporary rental and a long-term rental? In this post we tell you all the details so that you can choose the type of rental that best suits your circumstances and needs.
What is the duration of a housing rental contract?
Based on the provisions of article 9 of the Urban Leasing Law
the duration of the rental contract is freely agreed between the parties . If it is less than five years or seven years (if the landlord is a legal entity), it will be mandatorily extended by annual terms until it reaches a minimum duration of five or seven years, unless the lessee informs the lessor of his desire to terminate the contract.
In the event that the duration of the rental contract is not established, it will be understood that it is one year.
Furthermore, once its initial duration of five or seven years has ended, the contract will
be extended for annual terms up to a maximum of three years. Unless the lessor is notified four months in advance or the lessee two months in advance, of his will not to extend the contract.
Therefore, the duration of long-term lease contracts is the one regulated in the Urban Lease Law.
Can the landlord get the house back if he needs it?
It may happen that the landlord wants to recover the house because he needs it to occupy it himself or a family member.
In this case,
this need must be expressly stated in the contract.
To exercise this power, you must notify the tenant that you need the rented home. Also, the reason why he needs it, two months in advance. The lessee will be obliged to deliver the leased property. But if 3 months elapse from the expiration of the contract and the landlord or his relatives have not occupied the home, the tenant may request that the use be returned. He will be able to enjoy the home for a new period of five years. In addition, he may request the expenses that the eviction of the house has caused him. He will also have the option of being compensated with a monthly rent for each year that remains to be fulfilled until reaching five years of duration.
Can the lessee withdraw from the contract before the end of its term?
One of the issues that most worries home landlords is the possibility that the tenant may withdraw from the lease. In this sense, article 11 of the Urban Leasing Law establishes the
possibility of withdrawing from the lessee’s contract once the first six months have elapsed. This provided that the landlord is notified at least 30 days in advance. In these cases, the owner of the apartment and the tenant can agree in the contract that the tenant compensates the landlord with an amount equivalent to one month’s rent for each year of the contract that remains to be fulfilled. In the event that there is a period of less than one year, a proportional compensation will be paid.
How long is a temporary rental contract?
Regarding the
temporary rental we must differentiate two cases:
– Seasonal rental.
Seasonal leases are regulated in article 3 of the Urban Leasing Law, which establishes that they will have this considerationthe
leases of urban properties held by season, whether summer or any other. These leases are considered for use other than housing, so they will be governed by the will of the parties. This is the big difference with respect to housing leases that are regulated by the agreements established by the parties within the framework of the urban lease law and the Civil Code. Therefore, in the seasonal rental, it is the parties who freely agree on the duration of the contract and the rest of its conditions.
– Tourist rental.
The Urban Leasing Law excludes from its application the so-called tourist leases. Article 5 of the Urban Leasing Law establishes that the
temporary assignment of use of the entirety of a furnished and equipped dwelling in conditions of immediate use, marketed or promoted in supply channels is excluded from its scope of application tourism or by any other means of marketing or promotion, and carried out for profit, when it is subject to a specific regime, derived from its tourism sector regulations.
Therefore, for a tourist rental to exist, certain conditions must be met:
– That the entire house be rented furnished and equipped to be used immediately.
– That it be marketed and advertised in tourist offer channels.
– That there is a lucrative purpose.
– That it be subject to a specific sectoral regime.
In this type of contract there is no rule that regulates a maximum or minimum duration, so if the conditions are met for it to be considered a tourist rental,
the duration will be freely agreed upon by the parties.
The difference between a seasonal rental and a tourist rental is that in the latter the landlord offers complementary services similar to hoteliers such as cleaning, bed linen or reception.
What type of rental is the most profitable?
This question is difficult to answer because you have to consider many variables such as:
–
The landlord’s need for the home. If the landlord is going to need the apartment in a short period of time to occupy it, a tourist or seasonal rental may be more appropriate.
–
The location of the house. A house located in a central and tourist area of a city or on a beach is not the same. They are surely more suitable for a short-term rental. Unlike a house in a residential area that is more suited to long-term rentals.
–
The profitability you want to obtain. Profitability is also influenced by many factors. For example, in the tourist rental you get more income per day. But, you can have more expenses for maintenance and services such as cleaning.
–
Payment of taxes. In all cases you must analyze, with an expert tax advisor, the taxation of the rental. This way you can verify which is the most appropriate contract and duration for your circumstances.
Therefore, the duration of the housing rental contract will depend on the type of rental that is agreed between the tenant and landlord. But we must not forget that, if a seasonal rental is extended for a long time, it will end up resembling a long-term rental. And the tenant could have the rights of extension and others contemplated in the Urban Leasing Law.
Therefore, it is important to seek advice from an
expert real estate consultant who can tell you the best way to obtain profitability with the rental of your home, considering your epectations, the location of the home and, above all, the situation of the real estate market.
