tacit renewal: What is, How is it applied in the rental contract and why should it be taken into account??
What does the term tacit redirection mean and why are you interested in knowing how to apply it?.
This term is current since it can be an important variable to take into account if you want to raise the income above the 2%, and avoid at a specific time the law that limits rent increases.
What is it and how to apply it in rent?
Precisely, the tacit redirection interests many owners, especially, to those affected by the rent limit 2%, when making the annual update according to the CPI.
This law approved in 2022, and extended until the end of this 2023, aims to limit the rental price to owners, not being able to increase the income more than one 2%, in each annual update.
This law affects both large and small property owners., with the purpose of helping to stop the increase in rental prices in Spain.
Once we have discussed how the new limit of the 2 %, rent update that the government has approved, We explain how and when we can avoid it.
One way is to prevent the tacit renewal of the lease contract from being applied.:
The tacit redirection is a concept established in the Spanish Civil Code.
It is the process in which a new period is created, when the existing contract ends.
This happens when the landlord does not provide reliable and advance notice within the deadlines established by the LAU., and the tenant continues to occupy the home until 15 days after the contract ends.
In these cases, The contract is said to have been tacitly extended for another year., under the same conditions as the previous one, not being able to increase the income above the 2%, established.
Another aspect that is important to know is that the new tacitly extended period will be governed by the Civil Code as it will no longer be governed by the LAU. (Urban lease law)
Given the legal implications of the little redirection, It is always better to know its existence and be prepared to handle the situation should it occur..
To avoid a situation of tacit redirection, you must take into account the following:
Both the tenant and the owner must sign a contract that clearly specifies the rental period.
Besides, It is necessary to consider the extensions that may be applicable.
This will ensure that both parties know when the contract ends and in this way, the owner can anticipate to adequately notify his intentions.
As you see the little redirection cup, It is a legal concept to take into account and is worth knowing, above all, for those owners who wish to apply it or avoid it in case they want to increase the rent above the 2%.
We hope with this explanation we have clarified how this concept of tacit redirection works and thus avoid the limit of 2 % rent update at the end of the agreed period, thus being able to renegotiate the new conditions in a new rental contract.
If you are owners and have any questions, do not hesitate to contact us, We will be happy to resolve any of your doubts or queries.
