I.- INTRODUCTION
Law 4/2013 on measures regarding the relaxation and promotion of the rental market was published in the Spanish Official State Gazette (BOE) on 4th June in order to modify a series of aspects of the existing Urban Rentals Act, thus adapting it to the needs of the current rentals market. It should be noted that Spain has one of the weakest rental markets of the European Union due to the importance given to being a property owner by the Spanish consumers and the apprehension of owners to rent their properties. These measures intend to promote and make the option of renting more attractive for both lessors and their tenants.
II. RELAXATION AND PROMOTION OF THE RENTALS MARKET – MEASURES TO BE TAKEN.
Of the measures passed by the government, the following stand out:
a) Duration of the lease:
Up until the entry into force of the new law, the duration of the lease had to have an obligatory option for extension of 5 years at the discretion of the lessee and once these five years had elapsed, a tacit extension of three years, unless otherwise indicated by either of the parties. According to the new wording, the obligatory extension period is reduced to three years and the tacit extension to one year.
b) Recuperation of the property by the owner:
The recuperation of the property by the owner is allowed in cases where the property is intended to be used as the permanent home of the owner, provided that a series of circumstances are fulfilled, and always provided that the first year of the contract has been fulfilled.
c) Voluntary cancellation on the part of the lessee:
Likewise, measures clearly benefitting the lessee have also been taken, granting them the possibility to desist from the contract at any time with prior notification of 30 days, always providing that at least six months have passed as from the start of the contract.
d) The eviction of the lessee shall remain linked to the lack of opposition from the defendant, that is to say, in cases where the latter does not attend to payment demands or does not appear in court to oppose, the court clerk shall pass a decree finalising the eviction proceedings.
e) Modification to the rental assistance system:
With the entry into force of this law, a series of changes shall take place regarding the rental assistance system established in the State Housing Plan and Basic Rental Plan for the independence of young people leaving the family home. In particular, subsidies given to agreed upon loans received at this time, likewise, assistance programmes for tenants, urban and integral refurbishment, individual refurbishment and the so called “Plan Renove” (renewal plan) shall be maintained.
f) Registration of final judgements passed for non-payment of rental:
One of the most interesting points of the new law is the creation of a new registry for judgements passed for the non-payment of rentals, which is aimed at offering information regarding the risk involved in renting out property to persons who have a background of not fulfilling their payment obligations under the conditions of a lease agreement, and who for said reason, have been found guilty by a final judgement in an eviction procedure.
III.- CONCLUSION
Having analysed the measures taken by the government, we may arrive at the conclusion that the main aim is to make the rentals market more secure for the lessors, in an attempt to make currently uninhabited dwellings available for rent, thus increasing the offer of properties and making the market more attractive. Likewise, the relationship between both parties is made more flexible and provides a beneficial environment for both.
Vilá Abogados
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14th of June 2013
