Since so many of you rent homes, I thought I would explain what expat tenants need to know about renting in Mexico.
First, over half of expats don’t understand their rights or new regulations that have been designed to help them, according to recent findings. These findings revealed a worrying lack of tenant awareness regarding recent Mexican government changes. Some 85 percent of private renters are confused by the Mexican Landlord-Tenant Law.
Meanwhile, 41 percent claimed they were losing money because they do not understand the deposit protection scheme and what it entails, and nearly a third (32 percent) aren’t up to speed on their rights when it comes to getting their deposit back.
The research also revealed that tenants were unsure who was responsible for the upkeep of their home’s garden or green areas and who was in charge of other repairs inside and outside the property. What’s more, there was confusion over who bears responsibility for minor replacements and even property maintenance in gated communities.
Although we have stressed that much of the rental sector legislation has been introduced to benefit renters, it’s clear from this survey that many expat tenants are not fully aware of it.
Here are some key things you should know about current rental laws in Mexico:
- Tenants are only required to pay a month’s rent and deposit when securing a rental property, most upfront fees have been abolished and security deposits are capped at the equivalent of a month’s rent.
- Fees for brokers and agents, which are nearly always paid for by the landlord, are the equivalent of one month’s rent. It is usually known as a referencing fee or an admin fee. Nearly all landlords and real estate agents will carry out a background check on tenants before letting a property to them.
- A landlord can keep the security deposit only if there were damages at the time the tenant vacates the property. Tenants have the right to challenge any deposit deductions, either through a tenancy deposit scheme’s dispute resolution service or through the courts.
- The rent Agreement does not terminate if the landlord dies or if the property is sold to a third party.
- The Landlord is obligated to deliver an adequate and livable property as well as do construction repairs for its up-keep.
- If the landlord is a defendant in a legal suit and loses the property in judicial declaration, then he/she is responsible for paying the tenant compensation in the event they do not have to vacate the property until the term of the contract.
- If the tenant, without prior consent of the landlord, makes any remodeling or alterations to the property, he/she will lose the deposit and may be liable for damages.
- If the tenant is unable to use the property because of force of nature, or an intense damage to the structure, he/she is not obligated to pay rent for that period of time, and if its more than two months, the tenant can terminate the Rent Agreement.
- The tenant is responsible for any fires, if inside the property, but not if the property has fire damage caused by a fire outside the property.
- If the tenant does not alert the landlord, in a timely manner, of any damages to the construction, then the tenant shall be responsible for the repairs.
- The landlord can terminate the Rent agreement if the tenant does not pay the rent in two consecutive months.
- If any of the parties decides to continue the landlord/tenant relationship of the same property, they have to renew the contract or express that desire two month before termination of it.
- The landlord does not have the obligation to renew the contact if the tenant is not in good standing, has faulted in any way the Rental Agreement or if the landlord is going to occupy the property, his spouse or any family member in the first degree.
- Neither the landlord nor tenant is responsible for homeowner’s insurance, but it is highly recommended.
To ensure a smooth tenancy for both parties, you will need a thorough and precise tenancy agreement that details, for example, who is responsible for maintaining a rental property’s garden, who deals with repairs and minor maintenance tasks, who is responsible for cleaning the property and what the rules are when it comes to important repairs and remodeling.
Why is tenant awareness so important? For a mutually beneficial tenancy, all parties need to be on the same page – and it’s important that both landlords and tenants are aware of their rights, responsibilities and the regulations they need to adhere to.
You can help in this regard by staying well-informed of any changes in the law regarding the rental sector, whether it be new minimum energy efficiency standards, rules on HMO licensing or up-to-date information about the upcoming ban on letting agent fees. Alternatively, you could get your agent to do this on your behalf or engage an attorney to help you.
The Codigo Civil (Civil Code) covers everything from tenancy agreements to managing a tenancy, fire safety, health and safety, tax, repairs, responsibilities and liabilities. You can stay up-to-date by visiting my website, which outlines the rights and responsibilities of landlords and tenants in a clear and concise manner.