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Lease agreements are the most important keys of the Romanian real estate sector.
Whether you're a foreign landlord or tenant, handling lease agreements in Romania is essential to ensure a smooth and legally sound tenancy.
This article outlines the most important aspects of lease agreements.
Lease Agreements Types. Lease Agreements in Romania. Rental contracts Romania
In Romania, lease agreements are basically classified in two types:
Residential Lease Agreements (Residential Leasing in Romania), which serve to residential properties. These agreements tend to be more tenant-friendly, offering a strong protection against arbitrary practices.
Commercial Lease Agreements (Commercial Leasing in Romania), designed for businesses, commercial lease agreements follow the Civil Code, as the aboved ones, providing a greater flexibility for negotiation, but having a minimum fixed term. Terms and conditions in commercial leases are often more common in the real estate market, allowing for tailored arrangements that suit the needs of your business.
If you are a foreign investor interested in the Romanian real estate market, the first step should be your company incorporation. You could read more about it here.
Lease Duration. Romanian Lease Terms
Lease agreements in Romania can be either fixed-term or for indefinite term.
Fixed-term leases are set for a specific duration, while indefinite-term leases persist until is terminated by either party. In the case of fixed-term leases, specifying the lease duration is essential and also the automatic renewal, and this should be clearly reflected in the agreement.
Rent and Deposit. Tenant rights in Romania
What is essential to any lease agreement is the aspects of rent. The agreement should clearly state the monthly rent amount, the due date, and the currency for payment.
Romanian law allows landlords to request a security deposit, usually equal to one or two months' rent. Upon lease termination, the deposit is returned to the tenant, subject to any justified deductions.
Maintenance and Repairs. Landlord obligations in Romania
Lease agreements should also outline the responsibilities for property maintenance and repairs, as well as the costs for renovation, if the case may be.
Generally, landlords are responsabile for structural repairs, while tenants are in charge for day-to-day maintenance and minor repairs. The agreement should also specify how significant repairs are handled and who support the associated costs.
Termination and Notices. Legal aspects of leasing. Lease Renewal
Both landlords and tenants should be well informed about the termination and notice provisions outlined in the lease agreement.
Fixed-term leases conclude at the end of the specified period, except for the case when they are automatically renewed for the same period, while for the indefinite-term leases you need to respect a notice period, typically set at 1-3 months.
Don't hesitate to contact our experienced team of legal advisors for expert guidance here: office@cristinatudor.ro.
Rent Increases
Lease agreements in Romania usually include provisions for rent increases. The terms for raising rent, the frequency of such increases, and the maximum allowable percentage should be clearly detailed. Be aware of these terms helps prevent disputes withe the landlords.
Sub-lease and Assignment
The lease agreement should address whether sub-leasing or assignment is acceptable.
Sub-leasing (renting part of the property to another third party) or assignment (transferring the lease to a third party) often require landlord approval or notice and should be explicitly detailed.
Utilities and Common Expenses
Lease agreements should specify whether utilities and common expenses, such as maintenance of shared areas in commercial buildings, are included into the rent or paid separately by the tenant. Ensuring these provisions can prevent misunderstandings.
Eviction and Dispute Resolution. Rental disputes
A comprehensive understanding of the legal procedures for eviction and dispute resolution is crucial for landlords and tenants alike.
According to the Romanian rules, eviction is a strictly managed process, requiring court approval. The grounds for eviction and the procedure for dispute resolution should be outlined in the lease agreement.
Legal Compliance. Lease Agreements clauses
Lease agreements in Romania must fulfill the local laws and regulations. Foreign clients are encouraged to seek legal counsel when drafting or entering into lease agreements to ensure they meet all legal requirements, protecting their interests from potential penalties and legal complications.
Another aspect that should be pointed out here is the neccesity of the registration in the Romanian Land Book of your lease agreement, otherwise your right to use the leased premises will be not recognized before a new landlord, who acquire the buildign from the old one.
Conclusion
Lease agreements in Romania lay the groundwork for landlord-tenant relationships, and understanding their critical elements is essential.
If you're a foreign tenant, addressing the following: lease type, duration, rent, maintenance, and legal compliance is essential for a successful and carefree tenancy in the Romanian real estate market.
Seeking the legal advice is strongly recommended to ensure that your lease agreement is legally compliant and tailored to your specific needs. Don't hesitate to contact our experienced team of legal advisors for expert guidance here: office@cristinatudor.ro.
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