Renting a flat in Spain: How to know all your rights!
If you are considering a property (flat, apartment, house or finca) in Spain for a long-term rental, you will certainly want to know your rights and obligations regarding the letting.
Spanish tenancy law has some regulations that may differ from those in your country of origin. For example, in relation to the duration of the tenancy agreement, the possibilities of cancellation, payment of rent and deposit, work in the flat, etc.
It is therefore recommended that you prepare yourself well before signing a rental contract on the subject of renting a flat in Spain.
To avoid any bad surprises, I have summarised everything you need to know and bear in mind renting a property in Spain.
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General information
The Spanish Tenancy Law (“Ley de Arrendamientos Urbanos – LAU”) regulates the letting of urban properties intended for residential use or for purposes other than residential use.
The temporary transfer of use of the entire furnished and equipped flat for tourist purposes (rental/let of holiday flats in Spain) is not subjet to this law.
Clauses or provisions in the lease that modify the rules established by law to the detriment of the tenant or subtenant are null and void and are considered not to have been carried out, except in cases where the rule itself expressly permits this.
The following information is based on the reformed Law on Urban Leases (LAU) “Ley 29/1994 de 24 de Noviembre de Arrendamientos Urbanos”, which is currently applicable.
What form does the tenancy agreement take?
The parties may mutually agree to draw up the rental agreement (“contrato de arrendamiento or alquiler”) in writing.
In this case, the identity of the contracting parties, the identification of the rented property, the agreed duration, the initial rent of the contract and the other clauses freely agreed by the parties are documented.
How long is the period of the rental contract?
The following applies to rental agreements signed on 6 March 2019 or at a later date:
Minimum duration of the tenancy agreement:
- The minimum duration is 5 or 7 years (if the landlord is a legal entity), unless the tenant (“arrendatario”) expresses to the landlord (“arrendador”) at least 30 days before the expiry of the contract or one of the extensions that he does not wish to renew the contract.
The duration of the tenancy is freely agreed by the parties. If it is less than five or seven years, the contract will be extended year by year at the end of the period up to the stated minimum term of five or seven years.
No notification to the landlord is required for such an extension. It is sufficient for the tenant to remain in the rented property and pay the agreed rent. This is therefore a mandatory extension/renewal for the landlord and a voluntary extension for the tenant. The landlord cannot object.
Even if the landlord wishes to terminate the contract during this period (5 or 7 years) at the end of the agreed term, this is not possible without the tenant’s express consent, as the tenant is protected by law.
- Rental agreements with no fixed or indefinite period are deemed to have been concluded for 1 year (without prejudice to the tenant’s right to annual renewal in accordance with the aforementioned conditions).
Exception to the mandatory extension
The recovery of the flat due to the landlord’s own needs is an exception to the mandatory renewal.
After the end of the first year of the contract and provided that the landlord is a natural person, the contract will not be compulsorily renewed if the following was expressly stipulated at the time the contract was concluded:
- the landlord must take over the rented flat before the end of five years,
- to use it as a permanent residence (main residence)
- for himself or for his family members within the first degree of consanguinity or by adoption, or
- for their spouse in the event of a final separation, divorce or annulment of the marriage.
In order to exercise this right to regain possession of the flat, the landlord must notify the tenant of this circumstance at least 2 months before the date on which the flat is required, stating the reason.
The tenant is then obliged to hand over the rented property within this period, unless otherwise agreed.
If the landlord or his family members or spouse have not taken possession of the flat within 3 months of the end of the contract or after the flat has actually been vacated, the tenant may choose within 30 days whether he wishes to re-use the rented flat for a new period of up to five years.
Note
The landlord’s right to terminate the contract before the end of the five-year period (in order to regain the rented property) must be expressly stated in the contract
Tacit extension of the contract
At the end of the 5 or 7 years, the rental agreement is automatically extended by 1 year up to a maximum of 3 further years if neither party notifies the other in due time that it wishes to terminate the agreement. The tenant has the right to give notice of cancellation one month before the end of one of the annual extensions.
This so-called tacit extension of the tenancy occurs
- if either the landlord has not given the tenant 4 months’ notice before the end of the contract (at the end of the five or seven years);
- or if the tenant does not express his intention not to continue the tenancy agreement two months before the end of the term.
When can I leave the flat at the earliest?
Withdrawal from the contract
The tenant can withdraw from the tenancy agreement after at least 6 months if he gives the landlord at least 30 days’ notice.
The parties may agree in the rent contract that, in the event of cancellation, the tenant must compensate the landlord with an amount equal to one month’s rent for each year of the contract still to be fulfilled. For a period of less than one year, the proportionate part of the compensation is to be paid.
What other reasons are there for cancelling the rental contract?
If one of the parties fails to fulfil the obligations resulting from the agreement, the other party is entitled to terminate the lease agreement.
In addition, the landlord may cancel or terminate the contract by law for the following reasons:
- Non-payment of rent or the deposit
- Unauthorised subletting or cession of the rental agreement
- Deliberately damaging the rented property or carrying out work that the landlord has not agreed to, if the landlord’s consent is required.
- If disruptive, unhealthy, harmful, dangerous or illegal activities are taking place in the flat.
- If the flat is no longer primarily intended for permanent residential use.
The tenant may cancel the contract for the following reasons:
- Failure by the landlord to carry out necessary repairs.
- Actual or legal impairment of the use of the flat by the landlord
What happens if the owner sells the flat?
The tenant is entitled to continue the tenancy for up to five or seven years respectively.
The buyer of a rented property must accept the valid tenancy agreement, regardless of whether it is registered in the land register (“Registro de la Propiedad”) or not.
Exception: Rental contracts with an agreed period of more than five or seven years.
How is the rent determined and paid?
The rent is freely agreed between the parties.
The rent is payable monthly (unless otherwise agreed) and must be paid within the first seven days of the month. Under no circumstances may the landlord demand advance payment of more than one month’s rent.
The rent shall be paid in cash and at the rented property or at the place and in the manner agreed by the parties.
The landlord is obliged to provide the tenant with a receipt (“recibo”) for the payment or a payment procedure is agreed that proves the actual fulfilment of the payment obligation by the tenant.
How much can my landlord legally increase my rent by in Spain?
Updating/adjusting the rent
The annual rent increase is linked to the Consumer Price Index (IPC) for the duration of the lease (5/7 years).
During the tenancy, the rent can only be updated or adjusted on the date on which the respective contract year ends, under the conditions agreed by the parties. In the absence of an express agreement, the rent will not be updated.
The increase resulting from the annual update of the rent may in no case be higher than the result of the application of the percentage change in the consumer price index on the day of the respective update. This means that the consumer price index is the maximum limit for adjusting the rent.
The rent adjustment must be communicated in writing, indicating the percentage change applied and, if the tenant so requests, attaching the corresponding certificate from the National Institute of Statistics.
Can the rent be increased due to improvement work?
If the landlord carries out improvement work after five (5) or seven (7) years of the tenancy, he is entitled to increase the annual rent (unless otherwise agreed). The increase may not exceed twenty per cent of the rent applicable at that time.
The landlord must notify the tenant of the rent increase in writing, explain the calculations for the rent increase in detail and provide copies of the documents from which the costs of the work carried out can be derived.
Voluntary agreements can be made at any time between the landlord and the tenant to carry out improvement work (over and above the obligatory maintenance work) on the flat during the period of the tenancy agreement, with the possibility of increasing the rent. This does not interrupt the extension periods of the contract.
What is the legal deposit for rent in Spain?
A deposit (“fianza”) in the amount of one month’s rent for residential purposes and two months’ rent for non-residential purposes must be paid when the contract is concluded.
During the first 5 or 7 years of the tenancy agreement, the deposit is not subject to updating or adjustment. However, each time the lease is renewed, the landlord may request that the deposit be increased or the tenant may request that it be reduced.
If the deposit has not been refunded one month after the tenant has handed over the keys, legal interest will be charged.
In addition to the deposit, the parties may agree any type of guarantee for the tenant’s fulfilment of the rental obligations. However, the amount of this additional guarantee may not exceed two months’ rent (exception: long-term contracts).
Who is responsible for which costs?
The costs for property management (estate agent fees) and for formalising the contract are borne by the landlord.
General costs:
The general costs for the appropriate maintenance of the rented property, services, taxes and obligations that cannot be individualised and that correspond to the rented property or its accessories can be agreed by the parties in such a way that they are to be paid by the tenant.
This agreement must be in writing to be legally valid and must specify the annual amount of these costs at the time the contract is concluded.
Individual services:
The costs for services of the rental property that are individualised by means of measuring devices (such as electricity, water, gas, etc.) are always borne by the tenant. In this regard, you may be interested in my specialised article Electricity costs in Spain and how to reduce your bill.
Renting a flat in Spain. Who has which rights and obligations?
a) Maintenance of the flat
The landlord is obliged, without the right to increase the rent, to carry out all repairs necessary to keep the flat in a habitable condition for the agreed use. Unless the damage to the repair in question is attributable to the tenant.
In this case, you as the tenant can protect yourself against claims for compensation by taking out suitable liability insurance. You can get personal advice on this in English here:
International insurance for all your needs:
The tenant is obliged to
- inform the landlord as soon as possible of the need for these repairs.
At any time after informing the landlord, the tenant can carry out those repairs that are urgently required to prevent imminent damage or considerable inconvenience and demand payment from the landlord immediately.
- tolerate maintenance work that cannot reasonably be postponed until the end of the tenancy, even if it is very disruptive.
- to bear the costs of minor repairs necessitated by the wear and tear of normal use.
- to bear the costs of improvement work carried out by the landlord which cannot reasonably be postponed until the end of the tenancy.
b) Improvement work
The landlord must inform the tenant in writing at least three months in advance of the intention to carry out improvement work. Within one month of this notification, the tenant can withdraw from the contract, unless the work does not affect the rented property or does so only insignificantly.
The tenant who agrees to the work is entitled to a reduction in rent in proportion to the part of the flat that he cannot use due to the work, as well as compensation for the costs incurred as a result of the work.
c) Work carried out by the tenant
The tenant may not carry out any work that changes the property’s configuration without the landlord’s written consent. Under no circumstances may the tenant undertake any work that may cause damage to the stability or safety of the flat.
If the landlord has not approved the execution of the work, he may, at the end of the contract, demand that the tenant restore the property to its previous state or maintain the modification made, without the tenant being able to claim any compensation.
When can I sublet the flat?
The rented property may only be sublet in part and with the prior written consent of the landlord.
Under no circumstances may the price for the subletting exceed the price corresponding to the (main) rent.
Note
The address needs to be registered with the municipality (“empadronamiento”) if you have your habitual residence in Spain.
You may also be interested in these specialist articles:
Residency in Spain: What you should definitely know!
How to apply for EU registration certificate in Spain?
Permanent residence in Spain as an EU citizen: when and how?
Who needs the residence card for family members?
NIE number in Spain: All your questions answered clearly
