Possible temporary extension of temporary rental agreements due to Corona crisis

Now that the world is plagued by the Corona virus, many people stay at home as much as possible. But what if somebody has to leave his house right now because his temporary lease is expiring? After all, searching for other housing during this period can be made very difficult by, for example, quarantine, illness or loss of work. To alleviate these problems, a bill has been proposed to extend temporary rental agreements.

 

Act “Wet Doorstroming Huurmarkt”

What was the deal? On 1 July 2016, the Wet Doorstroming Huurmarkt came into force and it is possible for landlords to enter into a temporary lease for a maximum period of 2 years (in the case of non-self-contained housing a maximum of 5 years). Contrary to a tenancy agreement for an indefinite period, the landlord does not need a legal ground for termination and the tenancy agreement will end on the fixed end date.[1] However, if the temporary tenancy agreement is extended at any time, it will in principle automatically be converted into a contract for an indefinite period.

Bill on temporary rental agreement extension rules

Because it is by no means always desirable for landlords to enter into a contract for an indefinite period of time, a temporary law has been proposed in connection with the Corona crisis, which should make it possible to extend temporary leases, which end between 31 March 2020 and 1 July 2020, for a maximum period of three months. In that case, there will be no open-ended contract. For the time being, it can only be extended until 1 September 2020 at the latest. This means that if, for example, the lease would end on 1 July, it can be extended by a maximum of two months. It is not excluded that the measure will be extended if the situation so requires.

Timely notification remains relevant

In the case of a temporary lease, notice of termination is not required, but it is important that the lessor informs the lessee in good time of the date on which the lease is terminated, otherwise a contract for an indefinite period of time will be created. This notice must always be given to the tenant no more than three months and at least one month before the end date of the tenancy agreement. This is not different during the Corona crisis. It is therefore very important (!) for landlords to send this notification on time, even if there is an intention to extend the rental agreement in advance, otherwise a rental agreement for an indefinite period will still arise.

Obligation to provide information, realization of an extension

During the Corona crisis, the landlord will also be obliged, when sending the notification, to inform his tenant of the temporary renewal options. The tenant will then have one week to request an extension for the period of one, two or three months. The landlord is also free to make an offer for a temporary extension. In that case, the tenant is not obliged to agree to the offer. Furthermore, the statutory provisions regarding temporary leases remain fully applicable. This means, for example, that during the extension the tenant retains the option to terminate the temporarily extended lease with taking consideration of the notice period.

Refusal of extension

Only under certain circumstances may a lessor refuse a tenant’s request for an extension. If the landlord:

  1. has sold the property to a third party and has undertaken to transfer ownership of the property free of rent and use;
  2. has relet it and the tenancy agreement commences;
  3. wishes to move in himself and no longer has any other accommodation;
  4. wishes to renovate, which is not possible without termination of the lease, and has undertaken vis-à-vis third parties to make the accommodation available free of rent and use for that purpose;
  5. wishes to demolish and has undertaken vis-à-vis third parties to make the house available free of rent and use for that purpose, on a date prior to the expiry of the extension requested by the tenant and the landlord has undertaken before 1 April 2020.

On the advice of the Council of State, it will be added to these circumstances that a landlord may also refuse an extension if the tenant does not behave like a good tenant.

Do you still have questions regarding these measures? Please feel free to contact M2 Advocaten.

 

Lawyer Ginio Beij (beij@m2advocaten.nl)

1] https://www.m2advocaten.nl/valkuilen-bij-tijdelijk-huurcontract-woonruimte

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