Rental of Real Estate

Types of Tenancy Agreements in Spain

In Spain, the law draws a distinction between housing rentals —those intended to meet the needs for permanent accommodation of the tenant, their spouse, and/or their children— and rentals for uses other than housing. Rental of secondary residences (vacation homes), seasonal rentals, and rental of commercial spaces destined for industrial, business, crafting, professional, recreational, welfare, cultural, or educational activities fall into this latter category.

When the parties enter into a rental agreement, regardless of its category, the tenant must deliver a set amount to the landlord as a security deposit. When the tenant is ready to move out of the property, the landlord will check whether the dwelling shows any damages (beyond the usual wear and tear) or it is in its same original condition. Then, he/she will proceed to return the full deposit to the tenant or will deduct from it any moneys needed to repair the damages, if applicable.

The length of the rental agreement shall be agreed freely by the parties (six months, one year, four years, etc.). The law does not establish any minimum rental period. In this sense, it must be noted that the determining factor for a rental agreement to be either seasonal or long-term is not the duration of the rental period, but the reason for renting the property.

For example, if I am relocated by my company to Málaga for a 15 month period with the objective of performing a specific task, my rental agreement will be considered seasonal, despite exceeding one year, because the dwelling in question does not constitute my primary residence —I am only staying there temporarily, until the task is finished.

Long Term Rental Agreements in Spain

In the event the rental property constitutes the tenant´s primary residence, you should keep in mind that, if the length of the agreement is less than 5 years when landlord is a natural person (or less than 7 years, when the landlord is a company), once the termination date has been reached, the rental contract shall be extended on an annual basis until the rental period reaches a minimum of five years, or seven years if the landlord is a legal entity.

This means that, if the time length initially agreed to is one year, for example, then the contract shall be automatically renewed up to a total of five years (or seven if the landlord is a legal entity) if the tenant so wishes. There is nothing the landlord can do to shorten the duration of the rental agreement or to terminate the contract.

This mandatory 5 year renewal shall be void if the tenant notifies the landlord at least thirty days prior to the contract termination date (or that of any of its extensions) of his/her wish not to renew the contract and move out.

The mandatory renewal shall not apply either —being the landlord a natural person, and once the first year of the contract has already elapsed— if a clause was included in the initial contract indicating that the owner would need to occupy the home within five years for the purpose of using it as his/her permanent residence, or that of his/her children, or spouse in cases of legal separation, divorce, or marriage annulment.

As we can see, the Spanish legislation on property rentals is highly protective of tenant´s rights. Therefore, in order to minimize the risks the property owner could face, it is advisable to request certain guarantees from the tenant (copy of his/her pay slips, reference letters, and even bank guarantees), as well as taking out a rental insurance policy. In the event the tenant defaults on his/her rent payments, this type of insurance covers expenses for unpaid rent, and also includes a monetary compensation for any damages to the property that the tenant may have caused.

In case the tenant defaults on his/her payments, it is illegal for the landlord to threaten or force the tenants in any way to leave the apartment (for example, changing the lock or cutting off water and electricity services), since such actions are considered crimes. The landlord would have to initiate a judicial eviction procedure against the tenant. This procedure usually takes six months approximately to be completed.

Finally, any income earned from the rental of real estate is subject to the payment of taxes. Regulations on how to declare such income will vary depending on whether or not the landlord is a tax resident in Spain.

Vacation Rentals

Vacation property rentals (known as VFT, by its initials in Spanish) are those located on residential areas that are offered as tourist accommodation on a regular basis and in exchange for the payment of rental fees. In general, these properties are marketed via tourism distribution channels, such as travel agencies or web platforms for rental services where accommodations can be booked.


People can rent a number of bedrooms in a shared property, or can rent the whole place. If the whole property is rented, the maximum capacity will be 15 people —but only 6, if rented by rooms. Under no circumstance may more than 4 people stay in a single room.

Housing for tourism purposes/Vacation rentals do not include:

    • Those that are let free of charge
    • Those that are rented for a period longer than 2 months
    • Those located on rustic plots of land
    • State-subsidised housing
    • Properties made up of three or more units belonging to the same owner or operator agent, that are located in the same building or group of buildings (adjacent or not) within a radius of one kilometre (0.6 miles approx.).

To qualify as properties for vacation rentals, several requirements must be met by these units. Among others, they must have an occupancy licence, and have ventilation to the outside, window-darkening systems, a first-aid kit, bedding, and other household items.

Likewise, the owner of the house, or the rental service operator, will be legally bound to present an affidavit for the start of operations before the competent body. Otherwise, the rental service will be considered illegal and the person responsible may be subject to significant economic sanctions, in addition to the closure of the service.

Finally, it is mandatory to keep detailed records of all travellers’ arrivals and departures, and to send these guest records to the Spanish Police.

At Real(i)ty & Law, we can submit on your behalf the affidavit for the start of operations, as well as manage the payment of taxes accrued from the rental activity. We will be happy to answer any questions you may have about this kind of housing.

Property Laws in Malaga & Marbella, Costa del Sol


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