Both markets evolve differently across various districts, but the city average remains stable or rising, making it difficult for many citizens to access housing.

Author: E.C.
Source: El Confidencial

My siblings and I have inherited a property with a long-term tenant, an elderly mother, and we cannot get in touch with her. Her two children are uncooperative and refuse to sign a written contract, as the existing agreement was made verbally between the tenant and my deceased parents. They also refuse to accept a percentage increase in the rent. What can we do?

Long-term rental properties are those where the lease was established before 1985. Such contracts allowed tenants to remain in the property for life, or until their death, unless extended by subrogation as stipulated in Article 16 of Law 29/1994 of November 2, on Urban Leases (LAU).

One notable feature of these contracts is that they were established over 40 years ago, under a very different social and economic context in Spain. The rents were much lower at that time, and as prices have increased, the rent has remained unchanged, which is highly advantageous for tenants but has adverse effects for property owners. It is understandable that you would want to increase the rent.

However, the tenant is entitled to continue the lease even if it is not documented in writing, as the Civil Code permits verbal contracts, as stated in Article 1278: “Contracts shall be obligatory, regardless of the form in which they are made, as long as they meet the essential conditions for their validity.” These conditions for validity include consent and specificity of object and cause, following Article 1261 of the same Code.

Additionally, in the absence of legal regulations, the tenant is not obliged to agree to a rent increase and can continue paying the same rent agreed upon with your parents. If the tenant’s children can subrogate the contract (according to the conditions of Article 16 of the LAU), they also have the right to refuse the increase.

What you can do is terminate the contract if any of the exceptional conditions for non-renewal outlined in Article 62 of Royal Decree 4104/1964 of December 24 apply.

Lastly, if the tenant passes away and none of her children occupy the property within three months, you as the owners will also have the right to terminate the long-term rental contract.