Renting Guide
Legal provisions on renting and letting in Spain are contained in the Law of Urban Lettings (Ley de Arrendamientos Urbanos) of 1994, which applies to rental contracts dated from 1 January 1995 onwards. Contracts settled before this date, are governed by former rules, which have been modified by the current law of urban lettings.
A typical rental contract must include the following provisions:
- Name and details of landlord and tenant
- Description of the property
- The contract term or duration
- Agreed rent and payment terms
- Any other legal provisions or conditions agreed by both parties
Properties may be rented on short-term or long-term basis.
Short-term rental contracts (contrato de arrendamiento de temporada) are usually from 1 month up to 11 months. It may be renewed by property owner, or tenant might be asked to vacate the property by the end of the contract. This type of contract is commonly used for holiday or corporate rentals. The duration of lease must be specified in the contract.
A long-term contract is the standard form and has a 1 to 5-year duration. The first year is of mandatory compliance. After the first year, contract will be renewed automatically until the fifth year, unless the tenant decides to terminate it earlier.
At the end of the 5-year term, tenant may rescind the contract, after giving 30 days notice before the end of contract. If this were not the case, contract will automatically be renewed for an additional 3 years, unless the tenant refuses to accept this arrangement.
Any rental contract which fails to state the duration, will run for 1 year.
Contracts must be recorded at the Barcelona Property Registry or Cámara de la Propiedad de Barcelona.
If a client is seriously interested in renting a property, it might need to be reserved in order to take it off the market. This deposit is called a reserva or paga y señal and is basically a reservation corresponding to 1-month rent. The interested party will be given a receipt, confirming the reservation. In the event the rental is completed, this amount will be deducted from the total payments required by the transaction. Should owner decide not to rent property or rent it to another candidate, the full amount must be returned to tenant. However, if tenant changes his mind about renting the property, the reservation deposit will be kept by owner.
Tenants are required to pay the owner a security deposit (fianza) corresponding to 1-month rent payment for unfurnished properties, or 2 months for furnished ones. This is a guarantee that the property will be returned to the owner in the same conditions as it was delivered.
This amount shall not be used to pay the rent. It will be returned to tenant at the end of lease, assuming that the property is in good condition. Any damages found by owner in property upon inspection will be deducted from this deposit. The full or remaining balance shall be returned to tenant within the next 30 days after tenant has returned the keys.
The deposit amount may be increased after the 5 years of rental.
More and more owners are asking tenants for an additional deposit to ensure compliance of rental contract. This deposit is referred to as an aval bancario or bank guarantee and requires tenant to place and maintain a specific amount in a separate bank account (in Spain) for the duration of the contract. An official document is then prepared by bank and certified by Notary before being presented to owner.
The amount can range from 3 to 12 months' worth of rent, which owner will have access to in the event tenant stops paying rent or has caused major damages in the property. The guarantee money will also cover for any expenses arising from legal action or eviction process initiated by owner. The aval deposit must be returned to tenant at the end of the contract.
In some cases, owners might accept a Company Letter, in which a tenant's employer certifies or guarantees the necessary payments. Likewise, some companies decide to put the money down in the name of the employee.
The agreed rent must be paid within the first 5 to 7 days of each month, depending on the owners' requirements.
Tenants should receive a written receipt by mail as proof of rent payment. During the contract term, rent price will be increased or reduced according to the consumer price (inflation) index (Índice de Precios al Consumo - IPC).
Owner is responsible for payment of expenses produced for daily use of the property, such as community fees and real estate tax (IBI). However, tenants may be required to pay for these if it has been expressly agreed by both parties in the rental contract.
Tenants must pay for gas, electricity and telephone expenses, unless otherwise agreed. These expenses can be withdrawn through automatic debit from tenant's bank account if agreed upon in contract.
In the case of furnished properties, tenants will be required to sign an inventory of the property contents (furniture, fixtures and fittings) taking note of their conditions and any other observations. All contents must be returned in same condition. Any repairs or missing items will be charged to tenant.
Owner must ensure property is delivered in clean, habitable condition. Owner is responsible for any structural damages or those related to the building or community areas. Tenants must cover for repairs or any damages caused by normal wear and tear or due to mishandling of appliances or furniture.
Owner must be informed of emergency repairs. These shall be paid by tenant in order to avoid serious and immediate damage to the property. Owner must reimburse tenant for the cost of repair.
If owner decides to make any remodelling or repairs affecting health, hygiene and comfort in the property, he must give tenant 3-month notice with description of works. Tenant may renounce the rental contract within 1 month of the notice. If the tenant decides to stay, he is entitled to receive reduction in rent in proportion to the space affected by repairs.
Reasons for Cancellation of Contract
The owner may terminate the rental contract if tenant:
- Does not pay the rent or deposit
- Rents the property to a third party without the owner's consent
- Deliberately causes damages to the property
- Undertakes repairs without owner's consent
- Causes serious nuisance to the neighbours
The Tenant may rescind the rental contract when the owner:
- Fails to take necessary actions to keep the property in a fit and habitable condition
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