Usufruct is a real right that consists of the use and enjoyment of another’s thing, with the obligation to preserve and care for it as if it were one’s own. In real estate, a usufructuary can be a person who lives in a house that he or she does not own. So, Can an apartment be rented in usufruct? Does the usufructuary have the power to draw up a rental contract?
First of all, it is worth explaining that control over a property can be segmented into two parts: bare ownership, which grants someone the right to own the property, and usufruct, which grants the right to use and enjoy said property.
Differences between usufruct and bare ownership
Owning complete ownership of a property means having both ownership and the right to use it. However, as we have seen, this domain can be fragmented into two different categories:
Usufruct: Grants permission to enjoy and use an asset that belongs to another. Likewise, the usufructuary has the right to the benefits, whether fruits, income or interest, that that asset produces during the period of usufruct. Bare Ownership: Refers to possessing ownership of an asset but without enjoying the benefit of its use. Although the bare owner is recognized as the owner of the property, his ability to intervene over it is restricted. He will be able to fully enjoy the property only when the usufruct ends.
Can you rent an apartment as a usufructuary?
Yeah, you can rent an apartment in usufruct. When a property has established bare ownership and usufruct, the usufructuary is the one who has the right to enjoy the property and is, in addition, the only person with authority to sign a rental contract.
In these situations, the responsibility falls on the usufructuary to ensure that the home is maintained in suitable conditions for habitation. This involves making any necessary repairs to the floor. In addition, it is your duty to manage the collection of rent each month, assume the payments of the relevant taxes and, if it becomes necessary, you are the one who has the power to initiate an eviction process.
Can the usufructuary rent from the bare owner?
The usufructuary can rent an apartment to third parties and collect the corresponding rent, since it is within his or her right of use and enjoyment. However, it would not be logical that the usufructuary rents the property to the bare owner. This is because the bare owner already has ownership of the property and, therefore, it does not make sense for him to pay to rent something that is already his property.
In fact, doing so could be considered fraud or an act that seeks to avoid responsibilities or taxes. In any case, if there is any special interest in The bare owner would like to use the asset that is in usufructthe most appropriate thing would be to reach an amicable agreement or negotiate an early termination of the usufruct.
How long does the rental of a usufruct apartment last?
In the case of natural persons, there are two options regarding the duration of a usufruct:
Usufruct for life: As its name indicates, this usufruct lasts the entire life of the usufructuary. It is common in situations where, for example, one of the spouses dies and leaves the usufruct of the home to his partner, thus ensuring that he can live there until his own death.Temporary usufruct or for a specific period: Here, the right is granted for a specific period, be it months, years or any other period. Once that time has elapsed, the right to usufruct ends and full ownership returns to the bare owner.
In relation to the rental of a home with usufruct, it is crucial that the lease contract is aligned with the duration of the usufruct. For example, if the usufruct has a term of 10 years, it would not be appropriate to sign a 15-year lease.
Who can rent, the usufructuary or the bare owner?
In a property over which bare ownership and usufruct have been established, the usufructuary is the only one authorized to sign a rental contract. Likewise, it is this person who has the right to use and enjoy the property, which includes the right to rent it to third parties. The bare owner, for his part, has the right of ownership over the property, but cannot use or enjoy it while the usufruct lasts.
Who collects the rent, the owner or the usufructuary?
While the usufruct lasts, The rental income must be collected by the usufructuary. However, it can be established that the bare owner (the real owner of the apartment) enjoys part of said income.
What happens to the rental contract if the usufructuary dies?
He article 13.2 of the Urban Leases Law (LAU) indicates that upon the death of the usufructuary, the rental contract expires. Since many usufructuaries are elderly people who sold properties seeking liquidity, this carries a risk.
When the usufructuary dies, the bare owner may ask the tenant to vacate the home. However, if you do not act within 15 days, the contract is deemed to have been extended. To retain the right to evict, the landlord must notify the tenant by burofax before the end of that period.
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