EVERYTHING YOU NEED TO KNOW BEFORE PLACING A FLOOR FOR RENT
I WANT TO RENT
With the figures in hand, it is not safe to say that we live in a country of owners: 84% of Spaniards own a home, according to a study done this year by the Fotocasa portal. A figure much higher than that of other European countries. And it is that in Spain who can buy an apartment instead of renting it and, although a few years ago the upward trend of the purchase stagnated, the rapid recovery indicates that the cause derived more from the consequences of the economic recession in the families and the limited access to credit offered by banks, that of a possible change in the mentality of buyers.
The majority of the flats in property are destined to habitual residence, concludes the same report. Specifically, 78% are the address of their owners, 11% are second homes and 7% are for rent. According to Fotocasa, the remaining 4% corresponds to unoccupied homes. This small percentage is especially striking, due to the high profitability of placing a property for rent, especially if the apartment is in a large city such as Barcelona or Madrid. There is more to observe the studies on the matter. Idealist, another of the reference portals in the real estate sector, says in a recent report that the price of apartments for rent in Spain has increased by 24% compared to the same period of the previous year. The portal provides more data and specifies that, during the summer months, the average price per square meter reached up to 9.4 euros.
The lack of supply, the key to profitability
The main reason that makes the price of rental apartments more expensive is the lack of supply. This factor, combined with an increasing demand, causes prices to rise, especially in places like Barcelona or Madrid , where apartments for rent in central or trendy areas are highly sought after and tenants have to face a very tough competition to get an apartment. In fact, there are many who are forced to look for a flat in these cities, either for work or because they move to study there for a long time. This situation is causing serious housing problems and many people, especially the youngest, have been forced to abandon their neighborhoods of life to go to live in the outskirts and even outside the cities. A clear example of this process is found in Barcelona. Although its City Council claimed a year ago that in the city 30% of the house was intended for leasing - a percentage well above the Spanish average - the truth is that in no case has just absorbed all the demand and prices in the countless city is growing and they are already around 800 euros on average. These amounts make the owners of flats see the fact of putting them on rent as an opportunity to get income easily.
Is a touristic rental or a long-term rental better?
"For the owner there is no better option than another, since the two possibilities have their pros and cons," says Lois Avendaño, ARAG's claims coordinator. The increase in tourism has had a significant influence on the real estate rental market, especially in Madrid and Barcelona, as many owners have opted to allocate their apartment to tourism leases, with or without a license. Leasing for days or weeks gives them a much higher return than doing it for long periods of time, but this trend has only reduced the number of flats available for long-term rentals, thus raising the market price of these.
Avendaño recognizes that the tourist rental is more profitable, but it can also cause more headaches to the owner , who will have to hire cleaning staff between one stay or another, monitor the state of the property continuously and deal with the possible problems that arise with the neighbors.
Can I use my apartment for social rent?
In some cities like Barcelona, it is possible. This happens thanks to the measures that the City Council of this city is creating to favor the increase of the supply of flats and thus offer more affordable alternatives to tenants with fewer resources. And is that one of the main challenges of the administration is to reduce to the maximum the number of vacant properties. In most cases, the owners would like to sell their apartments but prefer to wait until the market recovers at all. Meanwhile, they do not opt to put the apartment for rent either because they are worried about the insecurity, or the property needs updating and they do not want to assume the costs of the renovation.
How to deal with a non-payment?
The main fear of people who put a flat in rent is suffer a default. Having to claim rents is a task that nobody wants to face, but it is even worse if the defaults do not persist and the only alternative is to claim and start eviction proceedings. From ARAG, Lois Avendaño, believes that "it is an extreme measure that may be the beginning of a long and expensive period and may even affect the owner personally and emotionally."
Of course, Avendaño acknowledges that starting a process of eviction in the unpaid rent is relatively easier and faster than in the case of mortgages . "In case of leasing, you only have to prove the non-payment of the fee, while in mortgages, the law obliges banks to open a mediation process with the client as well as to try to agree on an alternative form of payment before making cash. the eviction procedure, "he says.
For this reason, the figures show a considerable difference between the number of evictions executed on mortgaged apartments and those made on rented apartments. According to the administration of Justice, 90% of the evictions that take place in Barcelona are about dwellings and rented premises . The same happens in Madrid, where 73% of the evictions made during the first quarter of this year have been executed as a result of procedures derived from the Urban Leasing Law (LAU) and only 25.5% have been foreclosures.
Can the owner refuse to let the tenant sublet part of the floor?
Clearly yes, says Cristina González, lawyer of ARAG. "The law makes clear that the subletting of rooms will only be legal if it is done with the consent of the leased r", adds González. In these cases, the owner should record in writing, in the rental agreement, who will live in the property.
If the owner is not in the case of the sublease situation and discovers it after the signing of the contract, he would be entitled to cancel the rental contract requesting the abandonment of the apartment.
What to do in case of housing theft?
The illegal occupation of a house, whether classified as a usurpation or as a break-in, is one of the clearest risks of maintaining an unoccupied apartment , since once it happens, it is not easy to get the occupants of the property to leave. In this sense, according to Cristina González, "it is important to differentiate the concepts of home invasion and housing usurpation that, even if they are similar, legally have a very different meaning".
The burglary is the crime incurred by the individual who, without living in the house of another, enters it violently or not with the intention of occupying it. On the other hand, we are faced with an assumption of usurpation, or what is the same, before what is commonly known as occupation, when a property is occupied, remaining inside and against the will of its owner. To this last "I am referring, concretely, to the case of the squatters, who, in order to gain access to a third-party property, use violence in things, bursting, for example, a lock or breaking a window in order to gain access to the property they occupy." In addition, it is important, in order to understand the difference between one and another supposedly what is meant by "lodging", since in the case of acquiescence we are referring to the private domicile of an owner, and therefore, is being attempted against privacy. However, in the cases of usurpation or occupation, we are referring to a property that, although it is also my property, is not my usual residence, but is, for example, a second residence.
It is not an easy situation, González admits, but he points out that "it is important that the owner keep calm and go to the civil jurisdiction - demonstrating that he is the owner of the property - and does not enter his property, as it could be reported to his once for a crime of coercion . " From this moment it will have to be a judge who takes charge of the situation.
If I have a flat for rent, can I introduce myself to it whenever I want?
It must be clear that from the moment of signing the contract, the property becomes the residence of the tenants and, therefore, we must monitor a lot in presenting themselves. The landlord should only enter the apartment when the tenant agrees, says Cristina González, and "never enter the apartment without permission, as it could be a serious crime of breaking and entering."
Who should pay the maintenance and maintenance costs of the apartment, the owner or the tenant?
In this case, it is important to differentiate between conservation works and maintenance works, since in the first case, the payment corresponds to the owner and in the second to the tenant. According to Cristina Gonzalez, lawyer of ARAG, "the law makes it clear: the owners must pay the repairs of conservation of the house to maintain the habitability of the same, except that said works must be made for a bad use of the tenant, that in this case corresponds to him . "
However, the maintenance costs that the tenant must assume are those that correspond to the wear of the property due to its normal use . The problem arises when we can not differentiate between conservation or maintenance, for example, in the case of boilers, if these are damaged by the course of its useful life, its replacement or repair would correspond to the owner. On the other hand, if the repair consists of the replacement of a filter or a pilot or any other minor element, it corresponds to the tenant.
For all these reasons, it is advisable that the contract be clear about what expenses each one pays and in case of doubt, it will be necessary to resort to common sense and agree to avoid the judicial process.
Who assumes the costs of insurance in case of rent?
"A rental apartment must have the same home insurance in force as a property," says Lois Avendaño. On the one hand, the owner party should take over the payment of the policy that covers the continent of the floor - its structure - while the tenants must have it for the content. In this way, any damage or disaster that may occur: fire, theft ... would be covered by the insurance companies.
Maximum safety, less risk
To rent quietly, it is best to always have a rental insurance that takes charge of managing and solving the problems arising from the lease of the farm . According to the Association for the Promotion of Rental, the hiring of this type of policy has doubled in the last year. With an insurance, people with a flat in property can benefit from renting a flat, without having to worry or always be aware of what may happen with the floor. The main risk that is minimized with the policy is the default. This is mainly because before signing the contract, the same insurer does an examination of the tenant and their income and weighs if the candidate can face the burden of the rent. But if it still does not pay, the company takes over the claim for unpaid rent or, if necessary, to process the eviction file. In addition, in the case of ARAG , for example, it is the company that takes over the mediation with the tenant to be able to solve any problem that arises peacefully, before simply opting for the judicial way. Even, according to Lois Avendaño, claims coordinator of ARAG, "if the tenant has not paid the supplies for a while, the company pays the lower amount of paying defaults or the cost of changing the service contract or new registration, up to a limit 150 euros ". Of course, as long as an eviction or a claim for unpaid rent has been processed.
The insurance is without a doubt the best guarantee for the owners, who can also insure the rents by requiring additional guarantees from the tenants before formalizing the contract. In many cases it is decided to ask for one more month of guarantee that is added to the bond that the tenant has to deposit by law when renting a house. Thus, the owner earns a month of margin to face future possible defaults or delays in the payment of the rent.
As with almost everything, rent has its pros and cons, but in terms of profitability it is always a good option, since there are plenty of mechanisms to minimize the risks.
Source of information: api.cat