Lease Agreement – Legal Aspects and Key Considerations

Renting an apartment or commercial space is a step many people face—whether as lessors or lessees. Although it is often viewed as a simple transaction, the legal aspects governing this relationship are detailed and crucial for protecting the rights of both parties. The key document defining this relationship is the lease agreement. Ignoring its essential elements can lead to serious misunderstandings, disputes, and financial losses.

Form of the Agreement

The first and most important rule is that the lease agreement, as well as any sublease agreement, must be concluded in written form and notarized. This is a legal requirement prescribed by the Law on Housing. Oral or non-notarized agreements are not only legally invalid but also expose the property owner to misdemeanor liability and a fine of 300 euros.

This formality is not a mere bureaucratic procedure—it serves as a protective mechanism. Notarization ensures legal certainty, verifies the identity of the contracting parties, and guarantees that the agreement complies with legal standards.

Essential Elements of a Lease Agreement

To be complete and to properly regulate all aspects of the leasing relationship, the lease agreement should include:

• A detailed description of the property;

• Information about the contracting parties;

• Data on the persons who will use the property;

• Type of lease (residential or commercial);

• The amount of rent and payment method;

• Specification of expenses: clear indication of who pays the individual costs (electricity, water, heating, internet) and common maintenance costs;

• Duration of the lease;

• Reasons and conditions for termination;

• Procedure for handover of the property: description of how keys are handed over and the condition in which the property should be returned.

Obligations and Rights of the Lessor (Owner)

Obligations:

• Deliver the property in proper condition: The lessor must hand over the property in a condition that allows regular use in accordance with housing norms and standards.

• Maintenance of the property: The lessor is responsible for major repairs and maintenance of the property and building, as well as the costs of the reserve fund.

• Registration of the agreement: The lessor must submit a copy of the lease agreement to the competent Public Revenue Office and the municipality within 30 days of signing. Failure to comply also entails a fine.

Rights:

• Collection of rent: The primary right of the lessor is to receive the agreed rent on time.

• Inspection of the property: After prior notice, the lessor has the right to inspect the property at least twice a year, in coordination with the lessee.

• Termination of the agreement: The lessor may terminate the lease under legally prescribed conditions—for instance, if the lessee fails to pay rent, causes damage, uses the property contrary to the agreement, or subleases it without consent.

Obligations and Rights of the Lessee

Obligations:

• Use of the property with due care: The lessee must use the property as a responsible tenant, in accordance with the agreement, and is liable for any damage resulting from negligent use.

• Payment of rent and expenses: Timely payment of rent and all individual expenses.

• Reporting defects: The lessee must inform the lessor of any defects for which the lessor is responsible.

• Prohibition of alterations without consent: The lessee may not make changes, adaptations, or install equipment without prior written consent from the lessor.

• Return of the property: Upon termination of the lease, the lessee must return the property in the condition in which it was received, taking into account normal wear and tear.

Rights:

• Uninterrupted use: The lessee has the right to use the property without disturbance for the duration of the agreement.

• Request for repairs: If the property is not in proper condition, the lessee may request that the lessor carry out the necessary repairs. If the lessor fails to do so, the lessee may perform the work at the lessor’s expense and request a rent reduction.

• Rent reduction: The lessee may request a proportional rent reduction if unable to use the property regularly due to the lessor’s fault.

• Sublease: The lessee may sublease part of the property only with prior written consent from the lessor.

  
  

Termination of the Lease Agreement

The lease agreement may be terminated in several ways:

• Expiration of term: If concluded for a fixed term, the lease ends upon expiry unless the parties agree to extend it.

• Mutual agreement: The parties may terminate the agreement by mutual consent at any time.

• Termination by the lessee: The lessee may terminate the agreement at any time with a notice period of 90 days, unless otherwise agreed.

• Termination by the lessor: The lessor may terminate the agreement due to the lessee’s fault, but must first issue a written warning and allow at least 15 days to remedy the cause for termination. The lessor may also terminate the agreement due to personal needs, in which case they are obliged to provide the lessee with suitable alternative accommodation for a period of at least 90 days.

  
  

Registration in the Real Estate Cadastre

According to the Law on Real Estate Cadastre, the Agency for Real Estate Cadastre maintains a Register of Prices and Leases. Notaries and other competent authorities are required to submit lease agreements to the Agency for registration of the lease and recording of rental values. This record enhances market transparency and provides additional legal certainty for third parties.

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Conclusion

The lease agreement is one of the most common and important contracts individuals encounter in everyday life. It is not just a formal document with general provisions—it is the foundation of the relationship between the lessor and the lessee, with each agreement containing its own specific terms and details.

Comprehensive and precise regulation of all rights and obligations, in accordance with the law, is the best protection against potential misunderstandings or disputes. Therefore, it is always advisable to insist on a written, notarized lease agreement that contains all essential elements and provides legal security for both parties.

Such an agreement not only prevents future risks but also establishes a clear, stable, and predictable leasing relationship.

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Note: This text has been prepared solely for informational purposes and cannot be considered legal advice or guidance for specific actions. Legal matters are complex, and each case has its own unique circumstances that must be assessed individually.For this reason, it is recommended to consult a qualified attorney who can provide tailored legal solutions to your specific situation.