Leasing a property implies giving a property for temporary use to another party who agrees to pay a certain amount of money. This generates for both, the lessor, and the lessee, the existence of rights and obligations to keep the property in a good condition and fulfill its purpose of use.
To maintain and preserve the property in good condition of the leased property, improvements and reparations required, due to the use and course of time or any reparation needed per any damage produced by the tenant, their dependents, animals, subtenants, or another person who uses the property.
Definition and types of improvements
- Necessary: consist of preventing the destruction or deterioration of the leased property.
- Useful: consist of increasing the value and income of the property; without being necessary.
- Recreational: They are used to serve, decorate, or make things more comfortable; without being necessary or useful.
The Guatemalan Civil Legislation contemplates another classification: the locative repairs; that are the responsibility of the lessee, according to the custom of the place, such as damage caused by poor quality or construction defects.
The obligations for both the lessor and the lessee regarding the repairs and/or improvements for a leased property are detailed below, in accordance with the provisions of the Civil Legislation:
Improvements by the lessor
The lessor must lend the property in habitable and hygienic conditions, for which he must carry out any improvements and repairs that are warranted.
The lessor is responsible for the improvements or repairs that arise from deterioration resulting from the poor quality of the construction of the property, such as water leaks, floor repairs, cracks in walls, etc.
The lessor can agree with the lessee and authorize him to invest and improve the property leased, the amount equivalent to one or more of his rents, and must be specific on how much the lessee can spend.
Improvements by the lessee
The lessee can make all the improvements to the property that he wants to use during the lease without altering its form and is obliged to give notice of any urgent and necessary repairs to avoid the destruction or deterioration of the property. If the lessor has not made them, the lessee can terminate the contract or request judicial authorization to do them on their own, the judge must set a maximum amount to spend and the part of the rent that must be applied to the payment.
The lessee is responsible for the improvements and repairs that arise from damage or deterioration that the property suffers caused by him or his relatives, dependents, subtenants, or pets, since he must return the property in the condition/state in which it was given, except for the damage due to the use and the course of time.
In the event of a fire, the lessee, or lessees (if there are more than one), is responsible for the property that is the subject of the lease, unless the fire has been caused by a fortuitous event, force majeure, or construction defect and if the property is insured.
Conclusion
Everything, due to the use of course of time, or caused by events, needs to be improved and repaired; it is up to the lessor to carry out the necessary improvements and repairs to prevent the destruction of the property, and to the lessee those that are caused by it. However, the lessor and lessee may agree that the lessee make the improvements with their own funds, the amount spent being creditable to rent, it may also be without compensation from the lessor or deliver the property at the end of the lease term without such improvements, to guarantee that the property fulfills the purpose of its use.