In Mallorca the duration of a rental contract is usually of one year and possibly renewable for a minimum of 3 years and maximum of 5 more years, but even after the extension has been agreed, both the landlord and the tenant may put an end to it before its specified duration, as long as it is done under the necessary legal requirements.
From the tenant’s side, the obligation is to stay in the rented property for at least 6 months (regardless of the agreed contract duration), after which they may choose to discontinue the contract, for any reason, as long as at least 30 days notice is given to their landlord. Some contracts may stipulate a penalty for this situation, which could not be higher than a sum equal to one month’s rent for each year of the contract pending to be fulfilled and for lower time periods, a proportional compensation.
The owner/landlord can only request an earlier termination in two situations, which do not include selling the property:
- If there is a breach of contract from the tenant, or
- If after the first year of contract the property is needed for the landlord’s personal use or for a 1st degree (immediate) family member (son, daughter, mother, father or spouse, even if separated/divorced).
The first situation can happen if the tenant does not comply with their obligations: does not pay the rent, or causes damage to the property, or sublets the property without permission, or constantly causes disturbance to the community, or carries out illegal activities in the property.
If the landlord decides to terminate the contract for any of those reasons, either the tenant assumes the responsibility and accepts to leave, or the case may have to be sent to court and a judge will decide if there are indeed grounds for contract breach.
If the property is needed for the landlord’s personal use the tenant should be notified at least 2 months in advance. But, if after 3 months from the termination date, the landlord or 1st degree family member have not moved into the property, the tenant could actually request to return and even ask for compensation.
If the property is sold and the new owner is aware that there is a rental contract running (especially if the contract figures in the property registry), the rental contract has to be respected. If there are no records on the property register and the new owner was really not aware of the contract, the tenant may be asked to leave the property but always with a minimum of 3 months notice, given by the new owner.
At the end of the tenancy, the initial deposit can be partially or totally used to compensate the landlord for damage to the property (normal wear and tear cannot be considered here) or for any utility bills that come after the tenant leaves but that still refer to the rental period.
Therefore, apart from the tenant leaving the property and returning the keys, the landlord must also return the initial deposit, with any agreed deductions and both should sign an end of tenancy document that will officially terminate the rental contract and that is meant to protect both parts – on the tenants side, to confirm that it is no longer responsible for paying rent and has no outstanding amounts due to the landlord; and on the landlords side, the document officially terminates that tenancy and gives way to a possible new one or to the landlord occupying their own property.
f you intend to purchase a property in Majorca from a foreign country, Ripoll & Mateu Solicitors Mallorca can fully assist you in the buying process. We offer our clients a comprehensive service in everything required for the purchase of a property. Feel free to contact us, we specialise in Real Estate Law and legal and tax advice in the process of buying and selling a property in Mallorca.