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Tips for the lessor, interview with Belén Egusquiza, Team Leader of rentals in Madrid

1. What is the first thing to keep in mind when renting out a house?

The first decision that a landlord must make is what type of rental option you want for your house, because today the market offers two different alternatives: 

The long-term rental is traditionally where the tenant looks for a place in which to establish his habitual residence with the idea of stability. 

And the short-term rental, aimed at both domestic and foreign tourists as well as executives looking for a place to stay temporarily, is an alternative to a hotel.

In the holiday rental the owner may request higher rents, but in return he will have to take the risk of not getting the desired occupation, or having to make repairs and cleanings that decrease his profitability.
Conversely, long-term rentals offer the lessor more income stability and less likelihood of having to change tenants, with the costs involved.

2. Are furnished or unfurnished houses better rented?

For those who are looking for a stable long-term tenant, an unfurnished house would be a better option. However, those owners who want short-stay tenants (tourists who come on holidays, executives who will stay only a few months for professional reasons ...) will have more ease when renting out the property if they have it furnished.

3. What would be the perfect tenant? How can we avoid fraud? Can you ask for references about the tenant in Spain?

The perfect tenant is the one that best meets the expectations of the owner. And not only is it just a matter of money, but also a mutual "feeling" between both.

When buying a house, the relationship between buyer and seller can be reduced to a simple signature in the office of a Notary, but in the rent, signing the contract is only the beginning of the relationship between owner and tenant, where everything will be more rewarding for both if they understand each other well and have common interests.
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4. Does a real estate service guarantee the timely payment of the rent?

Real estate agencies help find the type of tenant desired by the owner, provide information about their financial situation and advise you about how to deal with possible breaches, but don't guarantee the rent collection.

5. Who is responsible for the property maintenance and the service charges?

It is the responsibility of the owner to ensure that the house is in good condition and that everything works correctly. However, if something is broken by an improper use of the tenant, the tenant will have to repair it. 

As for community expenses, the usual thing in Spain is that it must be paid by the owner, but this is a negotiable issue, and the parties can reach a different agreement.

6. How do we know what rental price is right for our property?

To set the right price, I recommend the advice of an expert. They have a global vision of the market and know the offer and the type of houses most demanded by potential tenants.

As for the rent request it is necessary to conform to the legislation, which sets a fixed monthly rent for habitual residence.

7. Is it mandatory to deposit the bond in a public body? Are there tax benefits?

In the Community of Madrid, the deposit is deposited in the IVIMA.

8. My tenants have been in my apartment for two years and are now asking me for a monthly reduction, what should I do?

Difficult question! Your decision will depend on many factors: are you happy with those tenants? Do they take good care of the house? Do they cause trouble to the neighbourhood? Do they pay well? 

Each case is different. My only recommendation would be that if you are comfortable with your tenant try to keep them, but keeping in mind that the rental market is becoming more dynamic, and with the help of E & V you can re-rent it fast and for a price that's more appropriate to the market.

Engel & Völkers

Génova, 27 - 5th floor
28004 Madrid
+34 91 277 45 00

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