Key Legal Aspects of a Lease Agreement
Whether you are a tenant or a landlord, it is crucial to understand all the rights and obligations that arise from a rental agreement. Residential lease agreements are regulated in detail by the Housing Act, which also defines the mandatory components of a rental contract. Including these required elements in the lease agreement ensures a high level of security and smooth "legal life" of the contract and the lease relationship. In this article, we will outline the key steps and provide tips to help you rent or lease a property safely and with peace of mind.
Signing the Lease Agreement
One of the fundamental steps is signing a rental contract that clearly defines the rights and obligations of both parties. It is essential that the agreement includes all legally required components, ensuring a high level of legal protection. For additional security, it is recommended that the agreement be executed in the form of a directly enforceable notarial deed, as this allows for the swift and straightforward fulfillment of contractual obligations without prolonged litigation. Concluding the contract in this form is crucial for the property owner or lessor, particularly for two reasons: the enforcement of the tenant's financial obligations (payment of rent and costs as stipulated in the agreement) and the vacating and return of the property to the lessor at the end of the lease term. If the tenant breaches the contract, for example by failing to pay rent or by not returning the property upon termination of the lease, the owner can immediately initiate enforcement proceedings. In this process, the court does not verify the facts regarding the existence of the claim, as the contract is already considered valid, provided certain conditions are met. This means that the property owner can enforce their rights more quickly and with less uncertainty.
Mutual respect for obligations is the foundation of a successful lease relationship. The property owner must report rental agreements to the Financial Administration, especially if the tenants are legal entities, and must inform the building manager of new tenants and any changes in the lease arrangement.
Ensuring the Legal Validity of the Lease
A property can only be rented out by its legal owner. Before signing a contract, tenants should verify ownership by checking the land registry extract or other relevant documents. If the owner authorizes another person to lease the property, the authorization must be in writing and notarized, as oral authorizations can pose unnecessary risks for tenants.
If the ownership of the property changes, this does not affect the existing lease agreement, as the new owner assumes all rights and obligations outlined in the lease. Additionally, if the number of occupants in the rental unit increases (e.g., due to the birth of a child), the landlord is required to sign an annex to the contract reflecting the new circumstances.
What Happens at the End of the Lease?
If a tenant passes away, the landlord is required to sign a lease agreement under the same conditions with the tenant's spouse, cohabiting partner, or one of their immediate family members, provided that person was living in the apartment at the time of the tenant’s death, had registered permanent residence there, and was mentioned in the lease agreement. A written request for the continuation of the lease must be submitted to the landlord within 90 days of the tenant's death.
A tenant can terminate a lease agreement without providing a reason, but a 90-day notice period applies. On the other hand, a landlord can only terminate a lease agreement based on either fault-based or non-fault-based reasons. However, the law imposes significant restrictions on both types of terminations.
A fault-based termination must be either explicitly stated in the contract or legally defined. Additionally, the tenant must first receive a written warning about the violation and be given 15 days to correct it. A non-fault-based termination is much more challenging and, in practice, almost impossible for landlords. This is because, in such cases, the landlord is required to provide the tenant with an alternative suitable residence. Due to these legal requirements, long-term rental agreements for an indefinite period are rarely concluded.
Conclusion
Renting a property is a significant decision that requires careful consideration of all details. Whether you are a tenant or a landlord, make sure that all legal procedures are correctly followed. Before signing the contract, read and understand its terms, verify the ownership of the property, and comply with all legal requirements to ensure a smooth and trouble-free rental experience.
