How to legally rent an apartment in Spain
Spain is a country where the purchase of real estate by Russians and representatives of other countries has been consistently in demand for more than a decade in a row – in addition to acquiring a “summer residence” on the foreign sea, investment in local housing is well demanded in order to subsequently lease it.
As the European Union dictates more and more conditions in matters related to the purchase of real estate and its operation, more and more often homeowners in the countries that are part of the EU are thinking about the legal lease of their property. Due to the fact that in 2019 the number of Russian citizens who own real estate in Spain, after a short recession, again became one of the main buyers of local square meters. In 2018, sales to Russian citizens increased by 18% compared to the previous year – about 2,000 real estate properties were sold to our compatriots, and this year this growth trend continues.
Old new law
In December 2018, a law came into force in Spain that reviewed the terms of rental of residential real estate in urban areas (Ley de Arrendamientos Urbanos – LAU). Thanks to the new document, the rights of landlords have significantly expanded and the protection of both parties from illegal actions and fraud has increased. However, at the end of January 2019, all the innovations were canceled, returning to the country the law adopted in 2013. Therefore, in Spain, as before, there is no established limit on the collection of collateral by the owner of the property being leased, its size is set at the lessor’s discretion. The maximum duration of the lease is again 3 years with the possibility of renewal for only 1 year. Today, all costs associated with the preparation of necessary documents are paid by the tenant.
The legislation of Spain provides for three types of rental housing: long-term, short-term and seasonal rent, while the last paragraph is more likely to apply not to the summer season, but to the school year.
Long-term rental housing
Today in Spain, the owner of the real estate is not required to obtain a license if it is a long-term lease. Thus, housing can be rented to any tenant at any time. However, it must be remembered that the minimum term for a long-term lease in Spain is 3 years, and this means that even if a shorter period is specified in the contract and the tenant agrees with it by signing the document, in case of a dispute the law will be on his side.
Early termination of the contract by the lessor is possible only after 1 year and only if the housing was required for their own residence. At the same time, the tenant, on the contrary, is not limited by such tight deadlines, and after the first 6 months of the lease, he is entitled to terminate the contract at any time, notifying the lessor of his decision at least one month in advance. In order to protect yourself, the homeowner needs to check the status of the potential tenant and his family, you can also require the introduction of not only an insurance deposit, but also an additional guarantee.
Long-term rental housing in Spain is not subject to VAT if the tenant is an individual. This rule also applies to a parking space and storage room, if they are rented together with housing and are included in the lease. In this case, all income received by the owner-lessor must be reflected in the annual declaration: for residents – in the income tax declaration of individuals, for non-residents – in the income tax declaration of non-residents.
Short-term rental housing
Based on the difficult conditions dictated by law to owners of real estate that they rent out for long-term rents, the choice is often made in favor of short-term ones. Moreover, from an economic point of view, it looks more attractive than long-term. But at the initial stage, without fail, you will have to go through the administrative formalities prescribed by law and issue a tourist license. It is possible to avoid this process by acquiring real estate with a ready-made license, when there is only a process of its re-registration as a new owner.
Obtaining a license
The Constitution of Spain allows each autonomous region of the country to have their own legislation and independently regulate legal issues of tourism activities. In Catalonia, which includes the super popular Barcelona, Costa Daurada and Costa Brava), tourist accommodation under license is an apartment, house or apartment, the owner of which rents the property out to third parties in exchange for payment for a period of not more than 31 days, two or more than once a year. In this region, the issuance of tourist licenses by local authorities has been suspended for an indefinite period, so it makes sense to purchase housing here.