Real Estate updates

Austria

Contributed by Graf & Pitkowitz Rechtsanwälte GmbH
Parliament stomps on stamp duty for residential leases
  • Austria
  • November 24 2017

In the run up to the recent snap elections, Parliament passed a bill exempting rent agreements for residential leases from stamp duty. The stamp duty on non-residential leases – in particular, commercial and retail leases – remains unchanged. However, these leases are being re-evaluated due to recent case law from the tax authorities.

Another brick in the wall: Constitutional Court reviews statutory rent regulations
  • Austria
  • August 18 2017

In 2015 Austria introduced an act which allows individuals, under certain conditions, to challenge laws before the Constitutional Court as unconstitutional. This gave hope to many landlords, which saw this as a tool to challenge the existing rent control regulations. The Constitutional Court recently handed down two new decisions on the same matter with surprising results.

Act on Equal Opportunities for Persons with Disabilities creates stumbling blocks for landlords
  • Austria
  • February 03 2017

The Act on Equal Opportunities for Persons with Disabilities recently entered into full force. The act prohibits, among other things, constructional barriers which prevent or impede disabled individuals from entering a building without help. While the act primarily addresses persons offering goods or services in such buildings, it also has implications for persons publicly offering real estate. In addition, the act has a significant impact on existing and new lease agreements.

Two or more units? Supreme Court clarifies exception to Rent Act
  • Austria
  • August 19 2016

While the Rent Act applies to both residential and commercial leases, there are some exceptions that give landlords greater flexibility with regard to their lease agreements. In particular, the act does not apply to buildings which house no more than two units. The Supreme Court recently considered whether a storage room and a separate building contained on the same property should be taken into account when applying this two-unit rule.

Urban development contracts fuel private real estate investments in Vienna
  • Austria
  • May 27 2016

In an effort to alleviate the pressure on the real estate market, the Vienna City Council recently amended the Building Code. This amendment authorises the city, among other things, to conclude urban development contracts as a means of expediting private investment in real estate projects. Since the amendment entered into force, the city has concluded several contracts with real estate owners.


Chile

Recognition of new in rem right affecting land use
  • Chile
  • July 29 2016

The recently passed Law 20,930 recognises a new in rem right of conservation that could affect land use. Once established, a conservation right will be transferable and transmissible and cannot be separated from the land for which it has been created. The right will be indefinite, unless the parties agree otherwise when it is established.


Cyprus

Immovable property tax rates for 2016
  • Cyprus
  • August 19 2016

Immovable property tax is payable annually and calculated by reference to the market value as at January 1 1980 of immovable property owned by the taxpayer at the beginning of the calendar year. For 2016 liability will continue to be calculated by reference to 1980 values, but immovable property tax will be abolished with effect from the beginning of 2017.


Denmark

New legislative package on planning agreed
  • Denmark
  • June 24 2016

The government recently concluded a new legislative package on planning. The agreement includes development opportunities in coastal areas and development opportunities in rural areas. The rules on planning in coastal areas address natural protection concerns and aim to keep the Danish coastline free from building development. However, the agreement has been criticised for its failure to relax Denmark's rigid planning rules for retail outlets.


Germany

Contributed by Noerr LLP
Impending terminability of land use agreements for energy plants
  • Germany
  • December 08 2017

The operation of energy plants usually means securing the required land long term by way of a use agreement. Prematurely ending a use agreement can substantially reduce the profitability of investments in energy plants. Defects in the written form of use agreements therefore constitute a risk for such investments. However, the Federal Court of Justice has decided that written form remedy clauses are invalid and do not prevent a contracting party from terminating a use agreement by invoking a written form defect.

Rental agreement termination for landlord's own use – new case law
  • Germany
  • June 16 2017

A landlord can terminate a rental agreement for residential premises if he or she has a justified interest in ending the lease. Two recent Federal Court of Justice decisions provide clarification regarding a landlord's needs as grounds for termination. While the change in case law regarding the legal consequences of a breach of the duty to offer is welcome, the judgments also show that there is no one-size-fits-all answer to the question of whether termination due to a landlord's needs can be declared valid.

Benchmark for determination of compensation value for use of residential property
  • Germany
  • March 17 2017

A residential landlord's right to compensation for use against a tenant who has been given notice of termination but not vacated the property in time is often of concern if the landlord demands compensation to the value of the rent customarily paid in the area. Until now, how to calculate this compensation precisely has been unclear. A recent Federal Court of Justice case has created legal certainty for those applying the law and has strengthened the interests of landlords.

Federal Fiscal Court clarifies trade tax implications of real estate investments
  • Germany
  • February 17 2017

The Federal Fiscal Court recently clarified previously disputed issues on whether the lease of a shopping centre qualified as trade income or income from property administration. Surprisingly, the court also decided that marketing measures conducted by a centre manager are not detrimental for trade tax purposes, giving real estate investors much more flexibility for existing and future real estate investments in terms of ring-fencing trade tax exposures.

Real estate transactions with sellers outside Germany jeopardised
  • Germany
  • November 11 2016

The sale of German real estate by companies or natural persons based outside Germany was recently made more difficult by the fact that the German tax authorities have obliged buyers to withhold and pay a lump sum of up to 25% of the purchase price for the account of the seller to secure the income tax incurred on the purchase price. This tax deduction can lead to the transaction failing if the purchase price is insufficient to cover both the seller's financing and the lump-sum tax deduction.