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The reality of false seasonal lease contract

It is very common that property lease, even when their real purpose is for residence, appear in the lease contract as a lease for purposes other than residence. This, as one can imagine, supposes a clear conflict with the real purpose of the contract.

The reason why landlords sign contracts with such an incongruence between the reality and the contract, is for fear that the contract could be considered as for habitual residence, which means that the rent shall be governed by the rights and duties established in the Urban Lease Act.

One of the reasons that landlords have this fear is because, according to current regulation, if nothing is agreed between the parties, the lessee can claim an annual renovation of the contract until the minimum period of three years is reached. The lessee may then also desist without suffering penalties, in the event that he or she stays in the property for a minimum period of 6 months, notifying that he plans to leave the property thirty days beforehand. Also, if nothing is agreed otherwise, the rent could be fixed at the same sum for the period of three years.

Three year agreements – lease contract

As a consequence of the above, the landlords must respect a three year agreement, which allows the tenants to leave the property within the period of six month without suffering any penalty.

However, case law has established that the solution for the landlords is not to sign contracts for 11 month periods, under the understanding that this will give the contract the status of lease for purposes other than residence. In order for the contract to really be considered to be seasonal, it should be made for “punctual effective residence”, not continual, as it is very easy to prove said continuity when the lessee carries out their professional activity near to the property and does not live in any other.

In order to be protected, independently of being a landlord or a lessee, the solution lies in having a properly drafted contract, in which the law is duly complied with, avoiding eventual objections from the Courts and protecting the interests of the concerned party.

Note that our Property Department, which is greatly experience in the drafting of lease contracts, has a team of highly qualified professionals that will study your case and draft a contract for your specific situation; whether this be according a protection against the tenant or the opposite.