The occasional bad behaviour of tenants shouldn?t discourage property owners from recouping their mortgages by renting their property. Most arrangements are mutually satisfactory; there will always be a minority who exploit the system.
There has been a dramatic slowdown in home purchase, which is fuelling demand for rental properties; not just for holiday purposes. This market has not reached its potential due to anachronistic legislation and judicial inertia in Spain?s legal system. Legislation weighs heavily in favour of the tenant, not the property owner.
UNSCRUPULOUS TENANTS
Inspired by concerns for social justice this may have been reasonable in the past; it gave security to tenants. Problems arise when unscrupulous tenants take advantage of judicial inertia and stop paying the rent.
The dilemma for the property owner is they cannot summarily evict ?squatters?; they need to hire a solicitor and file an eviction claim. Cutting access to utilities; water and electricity is not the answer: To do so can be construed as a crime of coercion.
In the City of Alicante the average procedure takes four months but in Orihuela you can be stuck with irresponsible tenants for up to a year. When the judicial procedure is complete and unscrupulous tenants abandon the property it is difficult to recover unpaid rent or put repairs right as tenants rarely have assets to pursue. With lack of legal protection many owners prefer to take their properties off the rental market.
TOUGH TENANT REFERENCES
Once outdated ideas that inspired current legislation are changed we can move to a more equitable system. The first should be the creation of a national or European public registry in which any person having abused a tenancy agreement should be filed as it would if they had a poor credit history. Legitimate owners would then be able to check the lease records of potential tenants
Complementary to such legislation the setting up of fast track civil courts in which evictions and related judgements take place in weeks rather than up to a year. A third measure might be a national fund as with vehicle insurance; a safety net contributed to by tenants and landlord to compensate owners in the case of extreme damage to their property caused by insolvent tenants.
CORRUPTION BEHIND ?SOCIAL JUSTICE?
Most will wonder why governments fail to adopt such practical measures. The reason has little to do with any desire to protect tenants from unscrupulous landlords. It is because a healthy rental market is in direct competition to the building industry, the mortgage industry; the banks and lending houses.
With more socially responsible legislation the only losers will be the banks. The rental market undermines it so paradoxically a system put in place to protect the vulnerable is being abused to protect the powerful.
SELF-PROTECTION
Improving the rental market is essential not merely for reasons of social justice but for sensible economic reasons.
A modern economy in a global world demands mobility of labour. Property owners can do much to prevent abuse of legislation. When offering property for rent set out the following conditions: 1. A month?s rent as a deposit, refunded on satisfactory departure. 2. Three recent bank statements to be shown. 3. Place of work and period of employment. 4. Previous references 5. A next-of-kin letter of support. One can also take out insurance.
As the Daily Telegraph ?properties section? pointed out most property problems are self-inflicted by purchasers avoiding the cost of a good solicitor.