By Welex, lawyers specialising in Real Estate Law in Spain
As a result of the health crisis caused by the coronavirus Covid-19 in Spain, Royal Decree Law 11/2020 of March 31 was published, which established an extraordinary extension to the leases of habitual residence in Spain.
The extension of rental contracts in Spain
Regarding the contracts for leasing of housing in Spain when these end, either the contractually established period, or their obligatory extensions within the period of validity of the State of Emergency or during the 2 months following the end of the same, the validity of these contracts will be extended by means of the concession of this extraordinary extension for a maximum period of 6 months.
The same clauses of the extended rental contract of the Spanish property will apply during that period.
In order for the aforementioned extension of the rental contract of your home in Spain to take place, a request from the Lessee to the Lessor is required, who must accept it, unless a novation of the contract has been agreed by mutual agreement between both contracting parties.
Another issue is that which is included in the RDL in the event that the Lessee is in a situation of economic vulnerability, distinguishing situations regarding the person of the Lessor.
If the Lessor is a public housing company or entity or a large property owner in Spain, meaning one that leases more than ten properties or has a constructed surface area of more than 1,500 m2, in these cases the Lessor must choose between remission of 50% of the rent or deferment of payment, with payment being made in instalments over a minimum period of three years, all without interest. The Lessee must require the Lessor within 7 working days for this purpose.
The moratorium mentioned above is limited to the period for which the alarm condition lasts and the following months with a maximum of four. Neither shall any penalty or interest be applied to the return of the accrued rent. Similarly, the Lessee is obliged to request the suspension of the rental fee within 1 month and must be in the aforementioned situation of vulnerability.
The beginning of the refund of the rent will begin:
– from the ending of the State of Emergency;
– or from overcoming the situation of vulnerability;
– or from 4 months after the end of the Emergency period.
The return of the rent is guaranteed by the Spanish Government, which will be responsible for the payment of the rent, which may not be passed on to the Lessee in certain circumstances.
Finally, the Lessee cannot take advantage of this measure if a total or partial remission or suspension of payment has already been agreed.
Click here if you wish to learn more on our property conveyancing services of our multilingual law firm in Spain.
Please do not hesitate to contact our law firm in Spain specialising in Real Estate Law for any fiscal or legal nature.