Rent: Can the owner and tenant agree to rent in Colombia free of charge? house for sale
Lease agreements may be concluded orally or in written form and the rent may be made freely by agreement between the property owner and tenant, although the monthly rent shall not amount to more than 1% of the commercial value of the residence or of the part of the property under the lease. The commercial value of such a property cannot at the time of the contract exceed two times the cadastre value of the residence.
Apartments for sale in Colombia
The rent can be fixed in any currency, but it must be paid in Colombian pesos at the exchange rate in force at the time of the contract, if it is set in a foreign currency, unless the parties otherwise agree.
The rent can be increased every 12 months after the lease agreement has been executed. The increase for the immediately preceding calendar year cannot exceed 100 percent of the Consumer Price Index. In any case, the new rent must conform to the above parameters of the initial rent limits.
If the tenant believes that the increase made by the landlord exceeds market prices, he shall have 6 months to apply to the mayor's office of the city where the residence is located for a revision.
Deposits
Deposits for lease agreements in Colombia are prohibited. The law also prohibits landlords from requesting links to ensure payment of contractual obligations for tenants.
What are the rights of landlords and tenants in Colombia, especially regarding contract duration and expulsion?
The landlord and tenant can agree on the length of the lease free of charge. If no specific duration is specified, the contract shall be understood to be for a year. The contracts shall be renewed on an equal basis unless a notice of termination is duly sent if both parties fulfill their contractual obligations and when the tenant accepts rental increases authorized by law.
The parties may agree to terminate the contract at any time.
The landlord can conclude the contract unilaterally
If the tenant fails to fulfill his duties, e.g. if he fails to pay rent or public utilities.
If the tenant is not in default, the landlord can terminate the contract in the renewal period (not in the initial period) by sending him a written notice of termination three months before the effective date of termination, advising the tenant that the compensation ordered is payable. Such compensation, equivalent to 3 months of rent, has to be deposited with the government-approved entities who subsequently forward it to the tenant.
Likewise, by sending written notices to the tenant 3 months before the date of termination of the contract, the landlord may terminate the contract at the end or of any of the terms and conditions of the renewal if: I the landlord will have to live for his home for at least one year; (ii) the property must be demolished in order to undertook the new construction; (iii) the dwelling shall not be constructed for less than one year; (in this case the landlord does not have to indemnify the tenant so long as he complies with the three months notice period).
The landlord can also terminate the contract by paying the compensation equivalent to 1.5 months of rent when it has not lasted less than four years.
The rescinding of the contract by the tenant is subject to similar provisions.
If the landlord breaks his contractual and legal duties e.g. if he interferes with the quiet enjoyment of the tenant's residence, the tenant can unilaterally terminate the contract.
The tenant may also terminate the contract unilaterally in the initial term or on any renewal term by sending the property owner a written notice of termination 3 months before the date of termination effective, informing it that compensation is payable in accordance with the law. Such compensation, which is equivalent to 3 months of rent, must be deposited with government authorized entities, who will then forward it to the landlord.
Lastly, by sending a written notice to the tenant 3 months before the date of termination of the contract, the tenant may terminate the contract at the end of the initial term or any of the renewal terms. In this case, no compensation is required.
Bogota residential properties of Colombia
It should be noted that, if the tenant submits or assigns the contract without the express consent of the landlord, it shall be considered a breach of the contract.
Both the proprietor and the tenant have the right to retention if the other party violates his duties. Therefore, if the compensation ordered by law has not been received, the tenant may refuse to leave the house. Similarly, if and as long as the tenant is defaulting in paying the rent, the landlord is entitled to maintain possession of any goods the tenant left.
In practice, the rules governing the renewal and termination of the lease favor landlords.
How effective is the legal system in Colombia?
Tenancy law shall be enforced by civil courts. Proceedings are long and the courts have an enormous backlog. Brigard & Urrutia believes that it would take perhaps three years, including 45 days for service, two years for trial and a year for enforcement to complete an expulsion of a tenant. However, while the expulsion proceedings are long, the landlords are protected because tenants are forced to rent while the trial is heard.
Law 820 of 2003 governs the eviction process and the procedural provisions are contained in the Colombian Code of Civil Procedure. The procedure, known as the "Restitution process for real estate leases," is carried out by a summary procedure with the participation of the tenant. However, if the complaint is based on failure to pay the rent, the tenant shall not be heard unless the rent is deposited with the court. The tenant has the right to refund his improvements and repairs to the house. In order to ensure payment of the rent or any other economic obligations under the contract, the landlord is permitted to apply for precautionary measures, including seizure of the tenant's assets. Judgements based on the absence of payment of the rental in the eviction proceedings cannot be appealed.
NON-PAYMENT EVICTION OF RENT
Duration until process service is completed 139
Trial Duration 279
Enforcement Duration 82
Total Evict Tenant Days 500
Courts: The Project Lex Mundi
Before starting an eviction process, a conciliation hearing is not necessary, which is necessary for most other civil actions.
Legislation
Leasing of residential properties is governed by Law 820 of 2003. This law covers all leases concluded after 10 July 2003. Prior leases shall be regulated in accordance with Law 56 of 1985. Trade leases and other types of lease agreements are governed by other laws, and general provisions of articles 1974 and subsequent to the Colombian Civil Code are contained therein.
Brief History: Colombian landlord and tenant law has recently changed
Colombia's law is guided by two constitutional principles: I property must meet a social purpose and (ii) each person is entitled to adequate housing.
Recently, the law has moved to strike a balance between landlords and tenants' rights. Landlords and real estate brokers in Congress have an organized lobby force and have had great success in obtaining stronger protection from the law over the past few years. Congress passed in 2003 Law 820, which aims to establish a uniform normative agency to regulate the leasing of residential houses rather than the rental of commercial houses and the rental of other goods. Law 820 was designed to give flexibility in lease agreements and the relationship between landlords and tenants. The Act estimated that 15 million people lived in rented houses at the time it was passed and 90% of them were low income populations. The law tries to offer new possibilities for suitable housing for families with low income and to promote the construction of rental buildings.