Do you own a flat and want to rent it out temporarily? You must be aware of the requirements you will need to meet starting in January 2025. In this post, we explain all the details about the new Temporary Rental Law.
In recent years, there has been considerable controversy in Spain due to problems with access to rental housing: increasingly high prices and a shortage of available properties. In this context, the 23% increase in the number of tourist rental flats in cities like Madrid has had a negative impact, as these flats are removed from the long-term rental market for permanent housing.
Additionally, it is considered that a significant number of tourist flats are illegal and do not comply with regulatory requirements.
To address this and other issues, the Temporary Rental Law is being developed.
What is the Temporary Rental Law?
The Temporary Rental Law is a regulation that governs the rental of flats and rooms for short periods of time.
As we know, long-term housing rentals are regulated under the Urban Leases Law (LAU), which, in Article 2.1, establishes that a residential lease is considered to be one that involves a habitable building intended primarily to meet the permanent housing needs of the tenant.
On the other hand, Article 3.2 establishes that leases for uses other than housing include leases of urban properties conducted for seasonal purposes (summer or otherwise).
To regulate these types of leases and others of shorter duration, a Royal Decree has been drafted, governing tourist rentals, seasonal rentals, and room rentals. Currently, the regulation has been submitted for public consultation and is under review.
What is the main objective of the Temporary Rental Law?
The law aims to achieve several objectives:
– Increase transparency regarding the information available on short-term rentals.
– Protect tenants.
– Prevent landlord abuses.
– Expand the supply of long-term rental properties.
Key aspects of the new Temporary Rental Law
If you are the owner of a property and want to rent it out temporarily, you should be aware of the most important aspects of the law, which are as follows:
Definition of temporary rentals and types
Temporary rentals are those that do not meet the tenant’s permanent housing needs.
The Temporary Rental Law classifies rentals into three main categories, which are as follows:
– Tourist rentals: rentals aimed at the tourist market, generally for days or weeks.
– Room rentals: rental agreements where only one room of the property is leased, with shared common areas.
– Temporary rentals for work or study purposes: intended for individuals requiring accommodation for work or educational purposes.
Floating accommodations or other properties suitable for short-term rental are also included.
Unified rental registry
To regulate this type of rental, the new law establishes a unified rental registration procedure to be carried out through the Land Registry or the Registry of Movable Property.
The procedure is as follows:
1. Submission of registration number application by the interested party.
The application must include:
– The address of the unit.
– Type of unit (entire urban property, rooms, or vessel).
– Whether it is part or all of the lessor’s primary or secondary residence, or offered for other purposes.
– Maximum number of people who can be accommodated.
– Whether the unit is subject to a regime of authorisation, licence, or approval.
– Category and rental duration.
– Applicant details (full name or corporate name, address, tax identification number, phone number, email address).
2. The registrar assigns a provisional registration number.
3. Assessment by the registrar or request for correction of deficiencies in the submitted documentation. If the assessment is negative and the deficiencies are not corrected, it will be reported to the Digital Single Window for Rentals.
The registration number may be withdrawn for non-compliance with requirements and will be valid for twelve months, subject to renewal.
Landlord Obligations
Under the new Temporary Rental Law, the landlord assumes new obligations, which are as follows:
– Obtain the registration number.
– Provide the information required in the application.
– Respond to information requests from the authorities.
– Update the information whenever there are changes.
– Communicate the registration number to online platforms.
Obligations of Short-Term Rental Online Platforms
Platforms such as Airbnb or Booking will have various obligations under the law:
– Provide landlords with the functionality to include the registration number in their application.
– Ensure that landlords can provide their registration number and display it in the listings.
– Conduct random and periodic checks through the Single Digital Rental Window (VUDA).
– Inform VUDA and landlords about the checks carried out.
– Inform landlords about the single registration procedure.
– Collect and transmit activity data for each unit on a monthly basis.
– Comply with administrative resolutions.
– Enable a mechanism for landlords to validate the format of the registration number.
Single Digital Rental Window (VUDA)
It has a national scope and serves as the digital gateway that will transmit data to short-term rental platforms. It must guarantee confidentiality, integrity, and security in the processing of data.
What Impact Will the Law Have on the Real Estate Market?
The short-term rental law will impact the real estate market in Spain in various ways:
– It is expected to increase the supply of long-term rental housing by reducing short-term rentals. This will make accessing rental housing easier.
– This could contribute to a decrease in prices.
– The hospitality sector may see an increase in occupancy and regain demand lost to short-term rentals.
– It will improve the quality of life for residents, especially in areas with a high density of tourist apartments.
– People requiring temporary rentals will have their rights protected.
Ultimately, the short-term rental law is a response to the complexity of the current real estate market in Spain. Its general objective is to protect both tenants and property owners and to promote a fairer market that ensures housing access for everyone.
The new law aims to bring greater transparency and security for property owners, tenants, and tourists alike.
If you own a property and wish to rent it out on a short-term basis, it is important to familiarise yourself with this regulation, which is expected to come into force in January 2025. If you need assistance with your property, contact our team of expert real estate advisers to analyse your case, guide you on the regulations you must comply with, assist with the procedures, and help you find tenants.
