The Covid-19 crisis is leaving many landlords and tenants who rent their Valencia Property in distress. Tenants, are facing the impossibility of paying the rent of their apartment in Valencia due to lack of income, ask for a moratorium on payment or a discount. Here there are some Valencia property rental tips for this 2020 hard times we are living as landlords.
There are many cases of non-payment of Valencia Property rental as a result of the new situation. Given the delicate circumstance, it is very difficult to address the non-payment by the landlord.
The Government is issuing a Royal Decree in April, 2020. We would like to break down the main points, so that you, as a property owner, would have some Valencia property rental tips in these difficult times.
From The Spanish Brick we give you a series of recommendations according to the Government’s emergency legislation.
It is necessary to differentiate if you are an owner of a property portfolio of less than 10 properties under Valencia rental management, or if you own more than 10 properties. In the second case, contact your lawyer or The Spanish Brick for more details to get advice.
If you are an owner of less than ten properties under rental management, this is the situation:
1) If the tenant is not paying for the month and has not contacted you, contact him/her to find out his/her situation. If he/she cannot pay the rent because of an emergency, propose that he/she pay at least half of the rent so that the bills do not accumulate. The economic situation will not improve soon, so it is expected that if he/she does not pay in April, it will be very difficult for him/her to pay in May.
2) Keep calm and reassure the tenant. There is not much that can be done until the state of crisis is over, except to manage grants or moratoria. According to the Decree, you cannot initiate an eviction until a maximum period of 6 months. In normal conditions, eviction can be initiated in the second month, but not now.
3) The tenant, who, out of necessity, asks for a moratorium on payment or a discount on the Valencia property rental price, must formally communicate this within a maximum period of one month from the date the law came into force.
IMPORTANT: The tenant must be in a vulnerable situation to make such a request, as explained in article 5 of the above-mentioned law.
Such conditions include having lost his job as a result of the pandemic, being dependent by age or state of health and having a total income less than three times the amount of rent under review.
4) If the lease expired just during the period when the alarm decree was enacted, the tenant can request an extension of up to six months.
5) The Government has launched a Valencia property rental aid program of up to € 900 per month and up to 100% of the rental income, for those tenants whose profile fits the “vulnerable situation”.
6) They will not be able to benefit from any moratorium or help when the tenant who rents the Valencia property or any of the people who make up the family unit that lives in it is the owner or beneficial owner of a home in Spain.
7) If you are the owner of an apartment with a mortgage, whether you live in it or rent it, you can also claim aid from the Government depending on your circumstance.
We recommend negotiating with your tenants as soon as possible. This is one more reason why we have always advised to maintain a good communication with your tenants from the beginning.
In the event of disagreement, the landlord must inform the tenant within a maximum period of 7 days that he will either reduce the rental price or give him a moratorium. In no case shall such a moratorium or discount be extended beyond 4 months.
If you have any questions or concerns, whether you are a landlord or a tenant, please contact us.