How to safely conclude a real estate lease agreement

Despite the ongoing war in Ukraine, the demand for residential and commercial property rentals remains high. While the rental market nearly froze in February 2022, by 2025 it has adapted to wartime conditions. In many regions, prices have not only returned to pre-war levels but have surpassed them.

However, when entering into a lease agreement, it is important to remember that this is a paid contract with numerous legal nuances. That is why every essential term must be clearly recorded in the agreement to avoid risks and ensure proper protection of your rights.

1. Verification of Documents

Before signing a lease agreement, both parties must provide documents for verification.

First of all, the landlord must provide documents confirming their ownership of the property. These may include:

• a sale and purchase agreement, gift agreement or exchange agreement;

• certificate of inheritance rights;

• certificate of ownership of real estate (issued before 2013);

• a court decision that has entered into legal force;

• certificate of acquisition of property through public auctions;

• extract from the State Register of Property Rights to Real Estate.

2. Verification of the Parties’ Identity

Both the landlord and tenant must confirm their identity by providing:

• a Ukrainian passport (or another identification document);

• Taxpayer Identification Number.

If one of the parties is represented by another person, a notarised power of attorney is required.

3. A Written Agreement Is a Must

It is not uncommon for parties to agree to a rental arrangement verbally — a “gentleman’s agreement”. However, such arrangements can lead to serious problems later: for example, disputes over the rental term or the amount of rent.

You may agree on a fixed one-year term, but a few months later, the landlord raises the rent. In this case, the tenant has virtually no legal mechanism to protect their rights, as verbal agreements have no legal force and are almost impossible to prove.

Article 811 of the Civil Code of Ukraine requires a simple written form for a residential lease agreement. Even without notarisation, such an agreement is legally binding.
Therefore, a written lease is not a formality but a genuine legal protection tool for both parties.

4. Key Provisions to Include in the Lease Agreement

Object of Lease

Specify the exact address, area, technical condition, and list all premises included in the property (rooms, storage area, bathroom, balcony, etc.).
If the property contains furniture or appliances, attach a separate inventory list.

Lease Term

Although leases are typically signed for one year, the parties may agree on a different term and rules for extension.

Rent Amount and Payment Terms

Specify:

• the monthly amount;

• the currency (national or foreign);

• payment date;

• payment method (cash or bank transfer);

• indexation or rent adjustment rules.

Rights and Obligations of the Parties

The tenant must maintain the property in proper condition, use it carefully, and promptly report any defects.
The landlord must ensure the tenant’s ability to use the premises, address technical issues not caused by the tenant, and guarantee no interference with use.

Early Termination

Define how and when parties notify each other of termination.

Force Majeure

This is essential, especially since the property may be located in an active combat zone.

Damages and Return of Property

Clarify procedures for compensating damages and returning the premises.

If you intend to make improvements to the apartment or commercial premises, this must be addressed in the agreement.
If renting a residential property and you have pets, this should also be mentioned.

Security Deposit

Specify clearly when the landlord may retain the deposit.
Often disputes arise over furniture repairs — the agreement should distinguish normal wear and tear from damage caused by the tenant.

5. When Is Notarisation Required?

Notarisation of the lease agreement is mandatory if:

• the lease includes a purchase option;

• the lease term is three years or longer.

6. Pay Attention to Additional Payments

Clarify who pays for:

• utilities,

• internet,

• security services,

• building maintenance.

Record meter readings in the agreement before signing.

7. Always Sign an Acceptance Certificate

This document records the condition of the property at the time of transfer — furniture, appliances, walls, windows, plumbing, etc.

It helps avoid disputes when vacating the premises.
The certificate should be signed by both parties and preferably include photographs.

8. Preemptive Rights of the Tenant

Parties often overlook the tenant’s preemptive rights under Article 777 of the Civil Code of Ukraine:

• the right of first refusal to purchase the leased property;

• the right to renew the lease on preferential terms.

However, according to the Supreme Court ruling of 18 May 2020 in case No. 522/7131/16-c, these rights are valid only if the tenant properly fulfils their obligation to pay rent.
Partial payment of utility bills does not constitute proper performance.

9. Additional Considerations for Commercial Leases

Most of the above rules apply to both residential and commercial leases.
However, when renting office, retail, or industrial premises, several additional factors must be considered.

1. Purpose of the Premises

Ensure the property’s designated use matches the type of business you intend to carry out.
If the property is residential, it must be officially converted into non-residential space — otherwise, issues may arise with inspections or business registration.

2. Improvements and Repairs

Commercial rentals often require modifications or remodeling.
The agreement should state:

• who finances the work;

• whether the landlord reimburses expenses;

• which improvements are inseparable and remain with the property.

3. Additional Fees

Beyond utilities, commercial leases may require payments for cleaning, security, maintenance, waste removal, parking, etc.
All such payments must be clearly specified.

4. Sublease

Subleasing is allowed only with the landlord’s written consent.
This is crucial if multiple businesses or tenants will occupy the space.

Remember: a sublease terminates simultaneously with the main lease.
In other words, if you are a subtenant and the main tenant’s lease ends and is not renewed, your right to occupy the premises also ends.

Conclusion

Renting real estate is more than just handing over keys — it is a legal process requiring careful attention to detail.
A properly drafted lease agreement with clearly defined terms helps avoid disputes and ensures peace of mind.

To avoid missing important legal nuances, it is best to consult a lawyer — a professional will review the documents and protect the transaction from hidden risks.