According to Czech law, tenants are perceived as the weaker party in a rental agreement, therefore they have greater protections under the law. Also, there are certain arrangements anticipated by the law that are not considered valid in the agreement for the benefit of the tenants.
Negotiating the agreement
Is a landlord entitled to demand a contractual penalty?
As of July 2020, a contractual penalty can be arranged to the detriment of tenants, however, the maximum amount of the contractual penalty a landlord’s claim cannot exceed three times the security deposit. The contractual penalty can be combined with a security deposit, however, once again the amount cannot exceed three times the security deposit.
Can a landlord specify his or her own conditions for the termination of a lease agreement?
No, the landlord can terminate the agreement only when the conditions of the Czech Civil Code have been met. See also the termination given by the landlord and termination given by tenant.
Lease period
A lease agreement can be arranged either for a fixed or indefinite time period. F A fixed-term lease agreement can be repeatedly prolonged. When an indefinite time period for the lease agreement is chosen by the parties, a landlord can terminate the agreement exclusively on the grounds prescribed by the Civil Code.
Do I need a written lease agreement?
Yes, Czech law requires a lease agreement to be in writing. Therefore, an oral agreement is not recommended even if the other contracting party suggests it will suffice.
Should I hire a real estate agency?
Well, it’s up to you, really. Even though the quality of services provided by real estate agencies vary, you can spare the hassle of finding the right home in most cases. The agency can also provide you with a lease agreement. You might be interested to know that the common commission for the services of a real estate agency usually equals the price of one-month’s rent.
Termination notice given by landlord
When is a landlord entitled to give a notice of termination?
A landlord can terminate the lease agreement exclusively on the grounds of one of the conditions established by the Civil Code.
The Civil Code recognizes three categories of these conditions:
Conditions for terminating the lease agreement after a three-month notice period regardless of the lease period being specified in the original agreement (fixed or indefinite)
- tenant gravely violates his or her obligation arising from the lease agreement;
- tenant is convicted of an intentional criminal offense committed against the landlord or a member of his or her household or against a person living in the house where the tenant’s apartment is located, or against another person’s property located in this house;
- if the apartment is to be vacated because, for reasons of public interest, it is necessary to dispose of the apartment or the house in which the apartment is located in such way that it can no longer be used for living;
- if there is another similarly serious reason for terminating the lease agreement.
Conditions for terminating the lease agreement after a three-month notice period when the lease period was specified as indefinite
- the apartment is to be used by the landlord or his/her spouse who intends to leave the family household and has simultaneously filed a petition for divorce, or if the marriage has already been ended by a divorce decree;
- the apartment is to be used for the landlord’s relative or for a relative of his or her spouse in a direct line of kin or in the second degree of the indirect line of kin.
Conditions for terminating the lease agreement immediately without a notice period regardless of the lease period being specified in the original agreement (fixed or indefinite)
- tenant violates his or her obligation arising from the lease agreement or stated by law in a particularly serious manner e.g.:
- tenant has not paid the rent and service costs (water, heat, electricity) for at least three months;
- tenant damages the apartment or house in a serious or irreparable way;
- tenant causes serious damage or inconvenience to the landlord or persons living in the house;
- tenant uses the apartment unlawfully or for a purpose other than agreed.
Does a landlord have the right to file a termination notice without warning the tenant first?
A landlord is obliged to specify what he or she sees as a particularly serious breach of the tenant’s obligation as stated above when filing a termination notice as well as filing a notice inviting the tenant to eliminate his or her defective behaviour or eliminate the illegal situation within a reasonable time prior to filing the termination notice. If the landlord fails to comply with these two conditions, the termination notice is inadmissible.
General formal requirements for a notice of termination
Is it possible to give an oral notice of termination?
No, a notice of termination requires a written form from both the landlord and tenant. Oral termination of a lease agreement shall not be accepted by either party and will be considered invalid under the law.
Does a tenant have any protection against an unjustified notice of termination?
The tenant is entitled to file a motion with the court to review the validity of the notice of termination within two months from the date the notice was delivered to him or her. Additionally, the landlord is obliged to inform the tenant about his or her right to raise objections against the notice of termination and the right to file a motion to review the notice of termination. If the landlord does not fulfil his or her obligation regarding this notification, the notice of termination is invalid.
Termination notice given by tenant
When can I terminate a lease agreement as a tenant?
Well, it depends on whether you signed the agreement with a fixed lease period or an indefinite one.
If the lease period is indefinite, the tenant is entitled to file a notice of termination after the three-month notice period. Unlike a landlord, the tenant is not required to state any reason for termination of the agreement.
If the lease period is fixed, the tenant has the right to terminate the agreement before the lease period expires only if the circumstances under which the parties signed the contract changed in a manner in which the tenant could not reasonably be required to continue the lease.
What if a landlord violates the rights of his or her tenant?
The tenant is also entitled to terminate the agreement immediately and without a notice period when the landlord’s violation of his or her obligations is particularly significant.
After the termination of a lease
Do I have any responsibilities as a tenant when the lease ends?
The tenant is obliged to hand over the apartment to the landlord with the keys. The tenant is additionally obliged to return the apartment to its original state. This often requires the tenant to ensure the apartment is painted and that any and all damage caused by the tenant is repaired before he or she leaves the apartment.
Tenant’s Rights and Obligations
Reconstruction and repairs
The Landlord wants to remodel the apartment. Can he or she do this while a tenant is living in the apartment?
The Landlord is not required to obtain a tenant’s consent in regard to reconstruction only under the following circumstances:
- the reconstruction
iscan be carried out without great discomfort or inconvenience to the tenant and the quality of living in the apartment is not diminished due to the reconstruction; - the reconstruction is ordered by the public authority or
- there is a direct risk of particularly severe damage if the repair is not done.
In any other case the landlord cannot proceed with the reconstruction unless he or she obtains the tenant’s consent.
Can a landlord demand that his or her tenant carry out the reconstruction of an apartment?
The Tenant is solely responsible for common maintenance and minor repairs e.g. a dripping faucet.
Can I as the tenant remodel the apartment to my liking?
Any and all repairs or construction work beyond common maintenance and/or minor repairs require the tenant to obtain consent from the landlord. If the landlord refuses to grant such consent, in listed cases the tenant can file a motion enabling the court to grant such consent instead.
Who is liable to carry out repairs in the apartment?
When any defect or damage occurs in the apartment which was not caused by the tenant, the landlord is liable to repair the damage. If the landlord fails to comply with his or her obligation to repair the damage duly in time, the tenant has the right to proceed with the necessary repairs and consequently claim any incurred costs.
Other occupants of the apartment
No pets allowed?
Even though in reality there are many real estate adverts stating that a tenant is not allowed to keep pets in an apartment, the landlord does not have the right to make such a demand under the law. Tenants are entitled to keep animals in an apartment so long as their presence does not cause the landlord or other occupants of the house any difficulties disproportionate to the common situation in the house. This means that if it is common for other occupants of the house to keep labradors in the apartment, your chihuahua fits right in. On the other hand, if your neighbourhood as well as the house is a well-known shelter for silent bibliophiles, your roaring lion could be justifiably denied.
Can a landlord require all visitors to be reported in advance?
The tenant is allowed to receive any visitors and does not need the landlord’s consent. Additionally, the tenant is not obliged to notify the landlord about such visits. However, the tenant is required to notify the landlord whenever the number of occupants in the apartment changes.
Can a landlord prevent me from getting a roommate?
In the event that a tenant permanently living in the apartment chooses to share the apartment with another person, the landlord does not have the right to prohibit this. However, the tenant is required to obtain the landlord’s consent if the tenant intends to sublet the apartment to a third party without living in the apartment as well.
How is a sublease regulated in the Czech Republic?
Aside from the information stated above, the terms of a sublease agreement are left to the discretion of negotiating parties. If a tenant and subtenant decline to specify the terms of the sublease, the provision of the lease stated by the Civil Code will apply.
Operating a business from the apartment
Can a tenant set up his or her business premises in an apartment and operate that business from it?
Yes, unless such activity causes excessive encumbrance of the apartment/house. However, you cannot register your official business seat in your apartment without the landlord’s consent or operate a business within the unit if it was rented to you as a space for living and not a place of business.
Landlord’s Rights and Obligations
Does a landlord have the right to inspect the apartment during the lease?
If a landlord provides reasonable advance notice of his or her intent to enter the premises, the tenant is obliged to allow the landlord to inspect the apartment to the necessary extent, as well as to ensure access to the building in order to carry out the necessary repairs or maintenance in the apartment/house. Prior notice is not required when it is necessary to prevent immediate damage or if there is a risk in delay.
Does the tenant have to comply with a landlord’s request to allow tours of the apartment when the lease is ending?
Within a period of no more than three months before the end of the lease, the tenant must allow, within reason, the landlord to tour the apartment which is about to be re–leased, while both the tenant and landlord are present. The landlord must offer the tenant reasonable advance notice of his or her intention to carry out the tour with potential new tenants.
Rent
I am new at this, what is rent?
The amount of money quantifying the value gained by the usage of an apartment. It is a regular and fixed sum of money, usually paid in advance for a month period.
Can a landlord raise the amount of the rent as he or she wishes?
No, the parties can specify the mechanism defining an increase of the rent payment for a specific period of time (e.g. every year) in the lease agreement. The parties can also explicitly exclude the possibility of an increase in the amount due.
When the agreement does not contain the aforementioned provisions, the landlord is entitled to propose an increase in rent up to an amount equal to that of a comparable apartment in the given location. However, an increase in rent when combined with all other increases within any three year period cannot exceed 20 %.
As a landlord I want my tenants to ensure the necessary services on their own, is that a correct procedure?
No, a landlord is obliged to ensure that the necessary services linked to the usage of an apartment e.g. water supply, electricity, heat supply etc. are in proper working order prior to the rental of a unit.
Can a landlord require suitable liability insurance to be arranged by a tenant?
Yes, in fact this is a common demand.
Does a landlord have the right to retain a tenant’s deposit when the lease has ended?
A security deposit serves as the landlord’s guarantee to ensure his or her tenant’s compliance with the obligations arising from a lease agreement. The arrangement of the deposit is not required by law; therefore, it is up to the parties to decide whether to arrange a security deposit or not. However, there is a limit on the maximum amount of a security deposit prescribed by the law. The law states that a deposit cannot exceed three times the monthly payment of the rent.
When the deposit is agreed upon in the lease agreement, a landlord is entitled to retain the deposit until after the termination of the lease agreement to compensate for damages caused by the tenant’s failure to fulfil his or her contractual obligations as well as any breaches of the lease agreement. Examples of damages may include unpaid rent, unpaid advances for services and damage or breakage that occurred in the apartment during the term of the lease. The amount of the deposit retained by the landlord cannot, however, exceed the amount of the real damage. The Landlord is obliged to specify on which grounds he or she is retaining the deposit as well as specify the exact costs incurred to compensate any damages and substantiate his or her claims, e.g. by providing bills, receipts, invoices. The Landlord must also inform the tenant of the date upon which the remaining portion of the deposit will be returned.
If the landlord is not able to substantiate his or her claims to retain the deposit, he or she is then obliged to return the amount of the deposit to the tenant upon termination of the lease termination. Moreover, the tenant is entitled to demand interest on the amount of the deposit in the statutory amount in cases where the landlord is in arrears (in cases where the interest rate is not arranged in the lease agreement, the statutory interest rate defined by the Czech National Bank applies. You can find the statutory amount of the interest rate here).
If the landlord unjustifiably refuses to return any amount of your deposit after the lease has ended, the tenant is entitled to file an action against the landlord for unjust enrichment.
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