How to properly draft a lease agreement for an apartment?

September and October are traditionally the months when the market feels the greatest demand for rental apartments, especially in Zagreb and other university cities. The return of students to universities also means increased competition for quality and affordable apartments. In such circumstances, a lease agreement is not just a formality, but the basis of protection for both tenants and landlords.

We have already written in detail about the obligations of both parties in our blog Guide to Long-Term Real Estate Rental, and now we are bringing you a concrete example of a contract and an explanation of its key parts.

What does the Housing Lease Act prescribe?

According to the Housing Lease Act (NN 91/96, 48/98, 66/98, 22/06, 68/18), the lease agreement must be in writing. If it is not, both parties lose legal certainty because disputed issues cannot be clearly proven.


Some of the key provisions:


Article 4.: The landlord is obliged to hand over the apartment in a condition suitable for living and to ensure peaceful use to the tenant.
Article 6.: The tenant is obliged to use the apartment with the care of a good householder and to pay the agreed rent.
Article 12.: The lease agreement can be concluded for a fixed or indefinite period. If not specified, it is considered to be concluded for an indefinite period.
Article 19.: The landlord can terminate the contract if the tenant does not pay the rent or utilities, or if he uses the apartment contrary to the contract.
Article 22.: The tenant has the right to request a reduction in rent if the apartment has defects that significantly reduce its usable value.

What should a lease agreement contain?

A well-drafted contract gives both parties legal certainty and clearly defines rights and obligations. It usually consists of the following elements:


Information about the contracting parties – name, surname, OIB and address of the landlord and tenant.
Description of the property – address, floor, area and any attached list of furniture and equipment.
Duration of the lease – fixed or indefinite period, with a clearly defined deadline.
Rent and utilities – the amount of the monthly rent, the method and deadlines for payment, and who bears the costs of utilities.
Deposit – the amount of the deposit and the conditions for return.
Rights and obligations of the contracting parties – maintenance of the apartment, reporting breakdowns, compliance with house rules.
Termination of the contract – conditions and notice period.


Example of a lease agreement

LEASE AGREEMENT


Made on _______ in ________ between:
Landlord: [name, surname, OIB, address]
Tenant: [name, surname, OIB, address]


Article 1. – Subject of the contract
The landlord leases to the tenant an apartment located at [address, floor, area], in a condition suitable for living (in accordance with Article 4. of the Housing Lease Act).


Article 2. – Duration of the lease
This contract is concluded for a period of [duration] starting from [date]. If not otherwise stated, the contract is considered to be concluded for an indefinite period (Article 12.).


Article 3. – Rent and utilities
The rent amounts to [amount] euros per month, payable by [date of the month] to the landlord's account. The tenant bears the costs of utilities: [list utilities].


Article 4. – Deposit
The tenant undertakes to pay a deposit in the amount of [amount], which is returned upon termination of the lease if all contractual obligations have been fulfilled and the apartment is returned in good condition.


Article 5. – Rights and obligations
The tenant is obliged to use the apartment with the care of a good householder (Article 6.) and to report breakdowns. The landlord is obliged to maintain the apartment and perform major repairs.


Article 6. – Termination of the contract
The landlord can terminate the contract if the tenant does not pay the rent or utilities (Article 19.), and the tenant has the right to request a reduction in rent in the event of major defects (Article 22.).

Termination of the contract

The contract is terminated in writing, with an explanation and a deadline for moving out of the apartment, which cannot be shorter than 15 days. The tenant can terminate the lease agreement concluded for an indefinite period, but is obliged to notify the landlord at least 3 months before the day he intends to move out of the apartment. Read more here.


If you are a landlord, keep in mind that you may be an obligor of:

income tax from property
income tax from property as income tax from independent activity
surtax on income tax
profit tax

Check how the lease is taxed and which tax rate applies on the pages of the Tax Administration.

Landlord of residential space.