Rental Agreements

Understand the different elements of the tenancy agreement when renting property in Azerbaijan...

Foreigners must ensure that they rent a property where the landlord has an ownership certificate which confirms that the landlord owns the property. Prospective tenants should be aware that for some new buildings owners do not get ownership certificates.

It is advisable to rent a property with a reliable real estate agency rather than an individual person, whose business might not be legal.

The Rental Contract

Rental agreements are not notarised and their terms and conditions depend on the mutual agreement of a landlord and tenant; therefore not all rental agreements are the same. While most real estate agencies have standard rental contracts, foreigners who are not backed up by a company must verify contractual obligations with a professional law firm.

A landlord has to pay 14 percent tax on the rental amount and this amount, which is included in the rent, can affect rental negotiations.

In general, real estate agencies prefer payment for their fees in cash. Sometimes a bank transfer is acceptable. Rental contracts that are signed between a company and a landlord are not paid in cash.

A rental contract is usually signed for one year with the first three months' rent paid up front. Some agencies may ask for the first month's rent only. If the rental contract is for two years, then the minimum amount to be paid up front is three months' rent.

It is advisable that pet owners check if pets are allowed in the rental property before signing a contract. Some landlords do not accept pets, and others may charge extra.

Furnished apartments

Before the rental contract is finalised, the inventory is checked. All items must be in working condition. An inventory usually lists in detail all white goods, appliances, furniture, linen and kitchen equipment.

For long-term rentals, a tenant can negotiate with the landlord to purchase extra items which are paid for by the landlord. It is also possible to negotiate replacing used items with new ones.

Unfurnished apartments

It is advisable to check Internet and cable television connections before signing a rental agreement. If there are no connections, the tenant has to negotiate the installation of these with the landlord.

Termination and renewal

The tenant must give the landlord 30 days' notice to extend or terminate the contract.

Documents

Foreigners can sign a rental agreement in their own name, in which case they must provide a copy of their passport to the real estate agency. However, when a company arranges housing, a company representative signs the rental agreement.

The landlord must provide a tenant with the following documents:

  • A notarised copy of the landlord's passport
  • An original and a notarised copy of the ownership certificate
  • If necessary, the landlord must apply in writing to the State Migration Service to request that the tenant is provided with temporary Registration at the Place of Residence. The application must include:
    • Tenant's name
    • Names of all family members (if applicable)

Property Insurance

Property insurance is compulsory in Azerbaijan. It covers the following:

  • Fire
  • Natural disasters
  • Theft
  • Gas explosion

Some insurance companies also insure the roof, walls and foundation of the property as well as interior decor. Insurance can also cover heating, electrical and plumbing installations and tools. New items can be added at any time according to individual requirements.

  • For further information from the Compulsory Insurance Bureau: Click here

Insurance agreements are signed for one year. Payment terms depend on the insurance company; some insurance companies accept 50 percent payment at the beginning of a contract and the second instalment within the next four months after signing the contract.

Customers can obtain discounts on their insurance policies when extending for a second year and higher discounts thereafter.

Utilities

There are meters for gas, water and electricity in old and new buildings. Electricity and gas meters are installed outside, while water meters are installed separately on cold and hot water pipes inside the property.