Can landlords refuse to extend the lease

Attention when extending fixed-term rental contracts

In particular, landlords should observe the legal requirements in the event of the extension of fixed-term rental contracts, otherwise there may be undesirable consequences.

I. Basics

Austrian tenancy law is very fragmented. Provisions on Austrian tenancy law can be found in the General Civil Code (ABGB for short) as well as in the Tenancy Law Act (MRG for short) and in the area of ​​non-profit housing (cooperative housing) also in the Charitable Housing Act (WGG for short). In the case of the conclusion of a fixed-term rental contract, it must first be checked whether the rental relationship is subject to the full or partial scope of application of the MRG, the WGG or just the provisions of the ABGB.

In the event that the tenancy is subject to the full or partial area of ​​application of the MRG (which is often the case with classic residential rental), the provisions on the minimum term in accordance with Section 29 MRG must be observed when the rental agreement is concluded. According to this provision, the lease must be for at least the duration of three years be concluded (written form requirement), otherwise far-reaching consequences threaten. If the provisions on the minimum term are not adhered to, the contract is deemed to have been concluded for an indefinite period. In particular, this means that the rental contract can only be terminated if there are important reasons for termination (interest arrears, etc.) in accordance with Section 30 (2) MRG. If the tenant does not give an important reason for termination, the landlord cannot unilaterally terminate the rental agreement.

II. Extension of the rental agreement

According to Section 29 Paragraph 4 MRG, fixed-term rental contracts can in principle written can be renewed as often as required. It is not absolutely necessary to conclude a new rental agreement. However, the minimum term of three years must also be adhered to when extending, otherwise an open-ended lease would exist again in the absence of a valid time limit.

The landlord should be particularly careful when the lease expires. If a fixed-term rental agreement (in the full and partial area of ​​application of the MRG) is not contractually extended or terminated after the time limit has expired, this applies in accordance with Section 29 MRG unique than extended to three years. If the rental agreement is not terminated or extended again after these three years have elapsed, this is deemed to exist unlimited Lease before. This has far-reaching consequences for the landlord. In particular, the rental agreement can then only be terminated if there is an important reason for termination (interest arrears, etc.) in accordance with Section 30 (2) MRG. It is therefore crucial for the landlord not to simply remain inactive in the event a lease expires.

The termination of the rental contract at the end of the contract period takes place by evacuating the rental property and returning it to the landlord. If the tenant does not return the rental property despite the expiry of the rental period, the landlord can bring an eviction action. It should be noted that this eviction action according to the case law within a period of 14 days is to be brought in from the end of the lease, otherwise an implied (tacit) extension of the lease can be assumed under certain circumstances.

In the scope of the MRG - as already shown - the lease would initially be extended once for three years.

If the landlord has justified concerns that the tenant will not comply with his eviction obligation despite the expiry of the lease (e.g. if he simply does not contact us), the landlord also has the option of obtaining a judicial handover order in advance.

(c) RA Mag. Daniel Lassingleithner, LLM.oec.

Disclaimer: This overview is provided for non-binding information only and does not replace individual legal advice, which is why no liability can be assumed for this.

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