In September 2024, Spain introduced its first comprehensive Housing Law, aiming to create a uniform and fair framework for housing access. This landmark legislation brings significant changes affecting both landlords and tenants, particularly in high-demand areas
In September 2024, Spain introduced its first comprehensive Housing Law, aiming to create a uniform and fair framework for housing access. This landmark legislation brings significant changes affecting both landlords and tenants, particularly in high-demand areas.
At Harvey Lawyers, we are committed to keeping you informed about how these changes might impact your rental agreements, property investments, and legal responsibilities.
Key Provisions of the New Housing Law
1. Large Landlord & Vacant Property Classifications
The new law defines who qualifies as a large landlord and what constitutes a vacant property, with implications for rental regulations and potential tax surcharges:
Large Landlord: Any individual or entity owning more than 10 urban residential properties or over 1,500 m² of residential space is classified as a large landlord. However, in areas declared as “stressed residential markets”, this threshold is lowered to just 5 properties in the same area.
Vacant Property: Properties left unoccupied for more than two years, where the owner has at least four such properties, are now classified as vacant properties and may be subject to penalties or additional taxes.
2. Limits on Annual Rent Increases
To prevent excessive rent hikes, the law introduces strict controls on how much landlords can increase rental prices each year:
In 2024, annual rent increases are capped at 3% for lease renewals.
From 2025 onwards, a new reference index developed by the National Statistics Institute (INE) will replace the Consumer Price Index (CPI) for calculating rent updates.
This change is designed to protect tenants from sudden spikes in rental costs while ensuring landlords can adjust rents fairly based on market conditions.
3. Extra Protections for Vulnerable Tenants
If a tenant is proven to be in a situation of economic vulnerability, they are now entitled to a one-year lease extension upon contract expiration.
This measure applies only when the landlord is classified as a large landlord, reinforcing the government’s goal of providing housing stability for those in need.
4. Landlord Responsibility for Property Management Fees
Under the new law, landlords are now responsible for covering all property management fees and contract formalization costs. Previously, these expenses were often passed onto tenants.
This change reduces upfront costs for renters while ensuring that landlords take full responsibility for legal and administrative aspects of rental agreements.
5. Stricter Eviction Rules & Tenant Protections
For tenants at risk of eviction, the law now strengthens safeguards by requiring conciliation or mediation processes, particularly when the landlord qualifies as a large landlord.
This ensures that tenants facing financial hardship are given a fair opportunity to resolve their situation before eviction proceedings advance.
6. Designation of Stressed Residential Market Areas
Authorities can declare certain areas as "stressed residential markets" if housing demand outpaces supply, making rentals increasingly unaffordable.
In these areas, local governments may introduce additional tenant protections, including:
Rent caps to prevent excessive increases.
Extended protections for lease renewals and vulnerable renters.
Incentives for landlords to keep properties occupied instead of leaving them vacant.
What This Means for Landlords & Tenants
For Landlords:
If you own multiple properties, particularly in stressed areas, be prepared for tighter regulations, potential tax surcharges on vacant units, and limitations on rent adjustments.
You must now cover property management and contract costs, increasing overall expenses for maintaining rental properties.
Short-term rental strategies may become more attractive, though local licensing regulations must be considered.
For Tenants:
Rent increases are now regulated, making lease renewals more predictable.
Stronger eviction protections provide additional security for tenants facing financial difficulties.
More temporary rental options may become available, particularly in student-heavy areas, as landlords adapt to new market conditions.
Need Legal Guidance? Harvey Lawyers Can Help
This new Housing Law represents a major shift in Spain’s rental market, balancing the rights of landlords and tenants while addressing affordability challenges.
At Harvey Lawyers, we understand that these changes can be complex. Whether you are a landlord adjusting to new regulations or a tenant seeking clarity on your rights, our team is here to help you navigate the legal landscape with confidence.
📩 For personalized legal advice, contact us today!
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