MARTINA DYLLONG In Spain, the rental law "Ley 29/1994 de arrendamientos urbanos", LAU, which was last reformed by Law 19/2009 of November 23, has been in force since January 1, 1995.

In Article 2 of the LAU, the legislator defines the concept of a residential tenancy. Accordingly, a residential tenancy exists if a contract is concluded for a habitable building whose primary purpose is to serve as a permanent residence for the tenant. The provisions on residential leases also apply to furniture, storage rooms, garage spaces, rented rooms or other outbuildings, but only if they are rented together with the dwelling.

1. form of the rental agreement

In principle, the rental agreement does not require a specific form, i.e. it can be concluded verbally. For reasons of legal certainty, however, it should be concluded in writing. Either party can insist on a written tenancy agreement.

2. content of the rental agreement

In general, freedom of contract applies in Spanish tenancy law. However, the mandatory provisions of Spanish tenancy law regarding the deposit and the written form of the contract must be observed. The content of contracts relating to residential leases is regulated in the LAU, although the law permits deviating agreements for certain content.

a) Contracting parties
Any natural person or legal entity can be the landlord of a residential property. Only any natural person can be a tenant of a residential property. In addition, groups of persons (tenants in a shared flat, married couples, life partners) can be parties to a tenancy agreement.

b) Description of the rental property

The rented dwelling must be precisely described in the rental agreement (street, house number, square meters, gate, apartment number, etc.), whereby the cadastral number should also be stated so that the dwelling can be precisely identified.

c) The amount and payment of the rent

The amount of rent is freely negotiable. The parties are also free to agree the method of payment (daily, weekly, monthly, etc.).
If the parties have not reached an agreement, the rent must be paid monthly in advance within the first 7 days of the month. If there is no provision in the contract regarding the method of payment of the rent, the rent must be paid in cash and in the rented apartment, whereby the landlord is obliged to provide the tenant with a receipt.

d) Deposit

The payment of a deposit in cash in the amount of one month's rent is mandatory. In many cases, a payment of two months' rent is agreed, especially if the apartment is furnished. During the first five years of the contract, the deposit does not have to be adjusted. The parties are free to negotiate the adjustment of the deposit.
The deposit must be returned to the tenant at the end of the tenancy. If the landlord withholds it one month after handing over the keys, interest on arrears will also be charged.
The landlord also has the option of demanding additional security. Nowadays, it is common for the landlord to demand a bank guarantee for an amount equivalent to several months' rent. This is to ensure payment of all rents and any repairs.

e) Adjustment and increase in rent

There is no legal obligation to adjust the rent. The law merely offers the landlord the opportunity to agree this. In the first five years of the contract term, the landlord can only adjust the rent once a year. The rent valid during the previous year is adjusted by the percentage by which the consumer price index (IPC) has changed during the twelve months preceding the adjustment. The reference month for the first adjustment is the month in which the index was published before the contract was concluded, and for subsequent adjustments the month in which the most recently applied index was published.
From the sixth year of the contract term, there is complete contractual freedom with regard to agreements on rent adjustments. In the absence of such an agreement, the same provisions apply as for contracts with a term of up to five years.

f) Ancillary costs

In Spain, service charges include the "general costs" ( gastos generales ) and the "individual services" ( servicios individuales ). The general costs are costs for the maintenance of the building, taxes for garbage collection, expenses for the gardener, expenses for the maintenance of a swimming pool, costs for insurance, etc., whereas the individual services are electricity, gas and water costs, the consumption of which can be read from the respective individual meter.
The possibility of passing on the payment of the annual property tax (impuesto sobre bienes inmuebles, IBI) to the tenant is often discussed. For tenancies concluded before May 1985, the property tax can only be passed on to the tenant if nothing to the contrary has been agreed between the parties. For tenancies from 01.01.1995 onwards, property tax can be passed on to the tenant, but this must be expressly stated in the tenancy agreement.
The agreed rent can include the amount for ancillary costs or can also be shown separately in the contract. In buildings that are subject to condominium law, the ancillary costs correspond to the share of the operating costs of the community of owners. In other buildings, the ancillary costs are calculated on the basis of the living space. The imposition of service charges on the tenant is only possible if this has been expressly agreed in the tenancy agreement. In the absence of such a written agreement, the tenant does not have to pay the service charges.

Author:
Lawyer Martina Dyllong
Johannesstrasse 33
44137 Dortmund

Phone: 0231-220 83 77
info@kanzlei-dyllong.de
www.kanzlei-dyllong.de