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Rents in conflict: What happens if the tenant pays the deposit and the owner regrets it?
December 1, 2023
The uncertainty about the possible repeal of the Rental Law, mentioned by Javier Milei, generated a drop in contracts. Owners prefer to wait, avoiding long-term commitments with semiannual adjustments, but renters can charge for the damages generated
By José Luis Cieri
Refusing to sign the rental contract by the owner once the tenant has already shown the home has its implications. How this situation should be resolved in times of supply shortage (Photo: Getty)
The possibility that Javier Milei could repeal the changes to the Rental Law triggered a scenario of uncertainty in the Argentine real estate market that caused an abrupt drop in rental contracts. Landlords seem to choose caution and postpone formalizing agreements, even when tenants have signed over the property.
Property owners understand that it is negative to commit to long-term contracts, especially if with the change of Government the regulations are modified again, or they return to two-year contracts under the Civil and Commercial Code . Today it is common to see cases in which, once the reservation has been made by the tenant, the owner reconsiders signing the contract. This phenomenon raises questions about how these cases are resolved and what rights tenants have when faced with the landlord's sudden decision to reverse the rental process.
In case of regret by the owner, after written acceptance of the reservation made by the tenant, the return of double the amount of the deposit is required.
Oscar Puebla, architect and Real Estate specialist, explained to Infobae that “if the deposit is paid at this time when the Rental Law passed in 2020 is still in force, the resulting contract will be subject to the provisions of said regulations. The conditions for making a new contract include one month in advance, one month of deposit, the presentation of a sufficient guarantee that satisfies the owner and establishing the update system that is planned today.
In situations where the owner revokes acceptance of the down payment, penalties may arise. “However, the imposition of these penalties through a judicial process is uncommon, primarily due to the relatively low amount of the down payment. In most cases, resolving the problem involves returning double the amount to the tenant, who is forced to continue searching for another property,” Puebla said.
Frustration
In a scenario of scarcity accentuated by an unprecedented decrease in supply (recording a year-on-year drop of 75% in CABA), the loss of the opportunity to rent a home after having made the deposit becomes a frustrating situation for the tenant.
To sign the rental contract there are several steps to follow, but in these times of uncertainty, there are owners who decide to postpone the agreement due to doubts about the future of the regulations that govern rentals (Photo: Getty)
After making the reservation of $300,000 for a townhouse in Villa Pueyrredón, Fabiana A, the real estate agency informed her that the owner was withdrawing due to uncertainty about regulatory changes and that he preferred to wait. Currently, the real estate company is working on finding an alternative home for Fabiana.
However, the owner who repented this week must reimburse Fabiana a sum close to $600,000 in compensation for the damage caused.
What is needed for a new contract
Before starting the search for your next home, it is crucial to consider the required documentation, the steps to follow and the general clauses of the rental contract.Among other aspects, to rent, you must be of legal age and meet these requirements: DNI or Passport valid during the contract, salary receipt and income certificate, rental guarantee (which may be title deed, bank guarantee, insurance bond, surety bond or joint guarantor), personal guarantee of the tenant by means of a salary receipt or income certificate (the income is added if there is more than one tenant), and, optionally, a guarantor, who is a third person, generally a family member, who is responsible for possible breaches by the tenant. This last requirement is not always requested by real estate agencies or owners.
"What we always recommend to the tenant is that if they are already in an apartment and have to negotiate a renovation, it is always going to be in their best interest to stay, today going out to look for a new property to move into with everything that that implies, it is almost a mission impossible. Some owners told us that they are going to wait and see what happens from next December 10, but on the other hand there are those who have had empty apartments for several months and do not want to continue covering the expenses of the apartment with money from their pockets, so they decided to go out. market to at least obtain a minimum income,” concluded Vanesa Ibarra of Salguero Propiedades to Infobae.
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