2019 The new rental law in Spain
28.10.20192019 - New rental law in Spain
Recently, new legislation has been introduced regarding the rental of real estate in Spain. It applies to all contracts concluding on March 6, 2019 or earlier. In the government's opinion, this act aims to increase the protection of tenants, as it has recently become increasingly difficult to find an affordable property for rent.
By decision of the government, the maximum lease period was extended from three to five years, or even seven - if the lessor is a company. Moreover, this act prohibits increasing the rental fee by an amount higher than the index. However, a threshold for a maximum rent proposed by the left-wing Podemos group was rejected.
All lease agreements concluded on or after March 6, 2019 are covered by the new regulations. For example, if a lease agreement was supposed to conclude on June 15, 2019 and it was supposed to last for a maximum period of three years, it is automatically extended for another two years, as the new regulation extends the maximum period to five years. All contracts ending earlier than March 6, 2019 remain unchanged, unless both the tenant and the landlord want its terms to be adjusted to the new legislation. In such a case, it is enough to attach a simple statement to the contract.
The three most important changes in rental law are:
The maximum lease period is extended from three to five years, or even seven if the lessor is a company. After five years, the lease agreement automatically extends to a maximum of three years. If the landlord wishes to end the lease at the end of the five-year contract, they must inform the tenant at least four months before the end of the contract, whereas the tenant's notice period is two months.
The minimum long-term rental period is one year. If the tenant wants to leave the apartment before the end of the contractual year, he or she must obtain the landlord's consent. If such consent is not received, the landlord has the right to retain the deposit. Moreover, if the tenant decides to leave the apartment before the expiry of the first six months of the lease, he or she is obliged to pay for the entire contractual year - also for the months in which they no longer plan to stay. This means that if the tenant decides to terminate the contract, for example after eight months of lease, he or she loses their deposit and is also obliged to pay for the notice period of two months. Thus, in total - they are obliged to pay for ten months of rent. However, if they decide to leave the rented apartment earlier - for example after five months, they must pay the landlord for the next seven months, and of course the deposit is lost. The exception is the tenant leaving the apartment due to the fault of the landlord, for reasons beyond the control of either party (e.g. a natural disaster) or other reasons that make it impossible to live in a given apartment - then, the tenant may leave the apartment at any time without incurring any compensation from due to early termination of the lease agreement.
The property owner may increase the rental fee each year only by the value of the index that applies in a given period. It is usually around 1-2%. The owner may ask for a deposit for possible damage, up to a maximum amount equal to one month's rent, and a deposit for rental fees (rental fee and electricity, water bills, etc.) up to a maximum amount equal to two months' rent. If the contract concludes before March 6, 2019 included the payment of this deposit in an amount exceeding the value of double the rent, the tenant may deduct this excess from the amount due for the last months of the lease.
The new legislation places the contracts that are registered and those that are not registered as equivalent. In other words, if someone buys a property that is rented out, the new owner must acknowledge the rights of the tenant.
The monthly rental fee must be paid no later than the 3rd of each month, whereas previously it had to be paid by the 5th. If the tenant is in arrears with rent or bills by the 8th day of a given calendar month, the property owner may submit an application to the Spanish social services to evict the tenant, which is usually carried out within a month. However, if the Spanish social services determine that the tenant is in an exceptionally difficult life situation, the eviction may be postponed for another month. Tenants whose situation does not indicate exceptional difficulty will receive expedited notification of the date by which they must leave
The new legislation also gives the local community (the so called Comunidad, local administration or other group living in the immediate vicinity) the opportunity to decide by vote whether given properties can be used for holiday and/or other short-term rentals. This is due to increasingly frequent resistance to online services such as Airbnb, which not only lead to higher rental fees in the area, but also cause some nuisance for residents caused by such occasional tenants.