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How to terminate the rental agreement of an old rented flat

There are less and less old rental flats that can be found within the Spanish territory. However, the law from the late 50s that tried to allow access to affordable housing for the most disadvantaged was so extensive that, today, there are still 200,000 of these homes left in our country. But in such situations, do the owners have the opportunity to unilaterally terminate the rental contract that links them to the landlord without harming the relevant rights of the tenants of the old rent? Here we will try to answer this question. 


Some background information about old rental flats

The first thing that must be done, before explaining the opportunities to terminate the contract that the owners of rented houses have for old rents, is to briefly expose the antecedents of the facts that occur at present to understand them better. In particular, these rentals started from the end of the 50s in the 20th century, at which time the Franco government launched a series of initiatives to promote access to housing for the disadvantaged families.

Several years later, these initiatives were reflected in the Consolidated Text of the Urban Leases Act of 1964, which was in force until 1985. This regulation reflected the right of tenants who had the right to extend their occupancy's duration. This means the term of the rental contract was not limited to just 5 years as it could be extended for a longer period. In addition, the contract not only transgressed the death or retirement of the owner, but also his transfer, on two occasions, to descendants or ascendants. What's more, the rental amount could only be modified in very small percentages.


Madrid - alquiler

In 1985, the so-called 'Boyer Decree' was approved. This was a name given in honour of its promoter Miguel Boyer, Minister of Finance Economy of the first government of the Socialist Party led by Felipe González. It abolished the forced tenancy extension and allowed owners to apply increases in the monthly rent that created the most competitive prices. But it was not enough.

Although there are several tax exemptions for owners of old rental properties and this only applies to those that were leased before May 9th, 1985, the truth is that, at this time, there is still a serious problem in this regard. In fact, it is up to the owners of the property to charge what they like for rent as it must cover the monthly service charges for maintaining the property. However, the unpopularity that would result from the total suppression of these contracts has held back all the governments that have tried to undertake such major reforms.

Is it possible for the owner to terminate an old rental agreement?


The answer is yes. Nowadays, the suppression of a rent of this type without prejudice to the rights of the previous tenants is contemplated by the law but only in very specific cases. These are:


1. For greater force


The law allows the owner to terminate the property's rental agreement if he or she wishes to use the house for himself or for any of his family members or first degree descendants. In case of trying to claim this circumstance, it is imperative that a valid justification is made. An example would be by which the owner needed a bigger house than the one he is currently living in. Likewise, it could also be considered as the need to occupy the property for family or work reasons that require a change of residence or town.

In the event that the owner wants to give the house to his or her children, the process becomes simpler. In this situation, it is sufficient to prove that the children are old enough to live independently and that they are in employment. Of course, in any case, it is essential to give an advance notice to the tenant in order to carry out the eviction in exchange for financial compensation. This will be equivalent to two years of rent compensation in the event that the tenant proceeds to leave the property in less than six months. With an annual tenancy agreement it takes twelve months from the notice period. 





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Foto: © Engel & Völkers Madrid

2. Yearly occupancy that's less than six months

Another reason that justifies the termination of the old rental contract is the non-occupation of the rented property for a minimum period of six months per year. In case this requirement is not met and the tenant can not justify the reason for his or her absence, the contract will be considered terminated. 

3. Sub-letting to a third party

In the event that the tenant proceeds to sub-let your home to a third party to take advantage of the low monthly rent they pay, the owner will also have the right to evict them.

4. Owning another property

The tenant can not own another vacant home aside from the one he or she is occupying, either in property or other assets, and enjoy the benefits that an old rental agreement implies. In fact, in case the landlord has proof of this, he will be in a position to refuse the forced extension of the property. The only requirement contemplated by the law is that, prior to the filing of the lawsuit, the tenant had the house in his possession for at least six months. If this has not been the case, you will have to wait until that period has elapsed.




5. Other reasons

Current legislation also covers other events that are grounds for cancellation of the old rental agreement. The first one is the non-payment of the monthly rent. The second is the execution of works inside the property without the explicit written permission of the owner. The third is causing intentional damages to any part of ​​the property.

What solutions are there to resolve a conflict over an old rent agreement?

Unfortunately, there are only two ways to proceed with the termination of an old rental contract. The first one is the negotiation, which is the most recommendable and beneficial one for both parties since it implies the eviction in the agreed time and the payment of the corresponding compensation.

The other is the judicial part, which only occurs when there is no agreement between the two parties. In this agreement, the owner must prove to the judge the main reasons that he or she wishes to end the landlord tenant relationship. It must be remembered that such court cases are often long and costly for landlords. In addition, during the time the trial is happening, the tenant can continue to live in the property and the landlord will have to continue attending to their obligations.

To summarise, these are the regulations stated by the government for the termination of old rental contracts that were signed prior to May 9th, 1985. We hope to have clarified all your doubts or concerns about this and that, from now on, you have a much clearer idea about the steps you must take in order to reclaim your home.


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