Many queries come to the study regarding this topic, what term currently applies to rental contracts, in what currency the rent can be agreed, how the increases are, among others.
What happens to the currency in which payment is currently agreed in lease contracts?
The reality is that currently, what was previously allowed no longer exists, which was the possibility that if the contract had been agreed – for example – in dollars, the obligation could be canceled by delivering pesos. This led to a mass of cases in court, since the parties submitted what had been agreed upon, by mutual agreement, to the discretion of a judge. Currently – without jurisprudence on the matter – following the guidelines established by the article of the decree, as a general rule, judges cannot modify the form of payment agreed upon by the parties, with the exception of it being at the request of one of the parties. them, when authorized by law.
What changes does the freedom to negotiate currency in locations generate?
It is a great challenge, above all, because the good faith of the parties is at stake when agreeing to their own contracts. What is happening, according to the queries received, is that these new freedoms have set a fairly high floor to be able to access new locations and the vast majority are being established in dollars. This creates a very disturbing and desperate position for tenants who do not have access to said currency, or who, if they do have access, are not certain of its future fluctuations.
How do updates proceed?
There is freedom to choose the updates, whether agreed by percentage or by index. It is always advisable to be able to set parameters that can be met in terms of the agreed obligations. Depending on how the contract was agreed, the update will be determined. Therefore, it is important to be careful and advise the client when agreeing on the currency of their contract.
¿Will the new law bring advantages in rental contracts?
It is the great desire that we all have, the challenge of supply and demand itself is to balance this situation, so that both parties can benefit. The previous law has created many obstacles and, consequently, a large part of the owners have stopped being actively in the real estate market. Without prejudice to this, I believe that we must achieve balanced agreements, in which both parties can benefit.
What happens now with the deadline?
What the parties decide within the framework of their freedoms will govern. However, if the parties have not established the term in the contract, it will be considered to be 2 years. We must highlight that there is a maximum term for locations intended for housing, which is 20 years.
And with the contracts in force, how does the decree impact?
Decree 70/2023 does not have retroactive effect, so contracts entered into prior to December 29, 2023 are not affected, so if a contract has already been entered into, it must be respected until its completion.
Today poses great challenges when it comes to advising the client on this issue, since it is always sought that contracts are sustainable over time and can be fulfilled.
We will be waiting for the debate that is currently going through the National Congress, without prejudice to the fact that the decree on rentals is in force, unless both chambers – deputies and senators – jointly reject the current regulations.
Text: Dr. Lucia Bruniñi
Contact information:
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Web: https://estudioraimondo.com.ar/
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