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If we are looking for a flat to rent in Spain, before signing the contract, many doubts may arise regarding the price, deposit, duration, or the rights and obligations of tenants and landlords. For this reason, at Fotocasa we have analyzed all the regulations affecting lease agreements and explained the 10 most important parts you must know before signing a rental contract.
1 – The laws regulating rental contracts in Spain
In Spain, there are different types of rentals, and each type is regulated by specific legislation.
- In primary residence rental contracts, the two laws that regulate them are the Urban Leases Act and the Law for the Right to Housing. In these two laws, we will find the answer to most of our questions, and they are the rules that both parties (tenants and landlords) must respect.
- In temporary rental contracts or room rentals (such as student rentals), this type of contract is mainly governed by the Urban Leases Act (LAU) under the modality of “use other than primary housing” (Articles 3 and 4.3) and, secondarily, by the Civil Code.
2 – The price of a rental contract in Spain
The price of a rental property may be agreed upon between the parties in accordance with the law. Article 17 of the Urban Leases Act states that “the rent shall be freely agreed by the parties.” However, the same law indicates that if the property is located in a stressed residential market area, the rental price will be capped.
“In residential lease contracts subject to this law where the property is located in a stressed residential market area during the period of validity of the declaration of said area under the terms set forth in Law 12/2023, of May 24, for the right to housing, the rent agreed at the start of the new contract may not exceed the last rent of the primary residence lease contract that had been in force in the last five years for the same property, once the annual rent update clause of the previous contract has been applied, without new conditions being established that impose on the tenant costs or expenses that were not included in the previous contract,” indicates Article 17.6 of the LAU.
So, before setting the rent, we must know whether the Public Administration has applied any price caps in our area.
For temporary rental properties, these limits would not apply, so the rental price must be agreed upon between the tenant and the landlord.
2.1 – Who must bear extra expenses in a Spanish rental contract
In addition to the rental price, in Spain there are other additional expenses that could be passed on to the tenant or the owner:
- Property Tax (IBI) and community fees: by default, these expenses are the responsibility of the owner. According to Article 20.1 of the LAU, “General and individual service expenses,” as long as it is clearly specified in the contract and the exact amount payable is stated, this expense could be passed on to the tenant.
- The garbage collection fee: also regulated by Article 20.1 of the LAU, by default it is paid by the owner, but if added to the contract, it can be passed on to the tenant, with the difference that it is NOT mandatory for the exact annual amount to appear in the contract for the clause to be valid.
- Agency fees: according to the First Final Provision of the Law for the Right to Housing, real estate management costs and contract formalization expenses are always paid by the landlord.
- In temporary rentals, who pays this cost can be decided in the contract.
- Property utilities: these are regulated in Article 20.3 of the Urban Leases Act (LAU), which states that “Expenses for services available to the leased property that are individualized through metering devices shall in all cases be borne by the tenant.”
3 – How does the deposit work in a Spanish rental contract?
The rental deposit in Spain is regulated in Article 36.1 of the Urban Leases Act (LAU). The law legally establishes maximum and minimum amounts depending on the type of rental:
- Primary residence: the mandatory deposit is 1 month’s rent.
- Temporary rental: the mandatory deposit is 2 months’ rent.
Apart from the legal deposit (the mandatory month), the owner may ask you for additional guarantees (such as an extra cash deposit or a bank guarantee) in accordance with Article 36.5 of the LAU. However, for primary residences, the law sets a strict limit: additional guarantees cannot exceed 2 months’ rent.
4 – What is the duration of a rental contract in Spain and contract extensions?
Regarding the duration of a rental contract, regulated by Article 9 of the LAU, it indicates that the duration of the contract is freely agreed between the owner and the tenant (for example, one year). However, the law protects the tenant by granting a right to a mandatory extension:
- Contracts up to 5 or 7 years: if the signed contract is for less than 5 years (when the owner is an individual) or 7 years (if the owner is a company or legal entity), the contract will be extended obligatorily year by year until reaching that minimum of 5 or 7 years.
- This extension is mandatory for the landlord, but voluntary for the tenant.
To not renew the contract: if the mandatory 5 years (or 7 if it is a company) are met, the landlord must give 4 months’ notice if they do not wish to renew. If it is the tenant who wants to leave, the notice period is 2 months.
| According to Article 9.3 of the LAU, the owner can bypass the mandatory 5-year extension only if, after the first year of the contract, they prove that they need the dwelling to live in it themselves or for their first-degree blood relatives (or spouse in the case of divorce). For this to be valid, this possibility must have been expressly stated in the contract from the first day of signing. |
5 – Notice periods in Spanish rental contracts
- To terminate the contract within the 5 or 7 years: 30 days in advance.
- To cancel the contract once the 5 or 7 years have ended: 2 months for the tenant and 4 months for the landlord.
- To update the rental price in accordance with the CPI or the IRAV: the owner must give written notice 1 month prior to the date on which the annual anniversary of the contract is reached.
- To return the deposit: the owner has a period of 30 days (one month) to return the deposit money from the moment the contract cancellation document is signed.
6 – How to cancel a rental contract in Spain early
Before the 5 or 7 years are completed: Article 11 regulates the tenant’s right to break the contract early without having to complete the full 5 years. The mandatory minimum period is once at least 6 months have elapsed since the signing of the contract. The tenant must communicate this to the owner in a verifiable manner (in writing or via burofax) with a minimum of 30 days’ notice.
Within the 5 or 7-year period, the tenant may decide not to extend the rental term up to 5 years by giving 30 days’ notice prior to the end of any of the annual periods.
What happens when the 5 or 7 years are up?
If that expiration date arrives and neither of the two parties says anything (the landlord must give 4 months’ notice and the tenant 2 months), the contract enters tacit renewal. The contract will automatically be extended for annual periods up to a maximum of 3 additional years.
7 – Rental price updates
According to Spanish regulations, the rental price may be updated each time an annual period of the contract is completed. This is an increase that the landlord can make each year to adapt the rent to the cost of living. It is regulated in Article 18 of the LAU.
The contract must include a clause expressly stating that the rent will be updated annually. If the contract does not mention any update, the rent remains identical throughout the 5 or 7 years of the lease and cannot be increased by default.
If the mandatory 5 years of lease have passed (or 7 if the owner is a company) and the contract comes to an end, the owner has the right to want to renew it, but by proposing a new, much higher price. This is no longer an “update,” but a new contract or an extension with new conditions.
When is the rent updated by the CPI and when by the IRAV? Indexes to update rent in Spain
| Type of contract | Date | Index for updating rental price |
| Primary residence | Signed before May 26, 2023 |
CPI |
| Primary residence | Signed from May 27, 2023 |
IRAV |
8 – What happens with repairs in a rented flat
Article 21.1 of the LAU establishes that the owner is required to carry out all repairs necessary to maintain the housing in habitable conditions to serve its agreed use. The landlord cannot raise your rent for making these repairs. This type of breakdown includes issues with pipes, the boiler, roofs, etc.
However, Article 21.4 makes it clear that “minor repairs required due to wear and tear from ordinary use of the housing shall be borne by the tenant.” Changing blown lightbulbs, a broken blind cord, a door handle, the range hood filter, or the shower hose.
Since the LAU does not provide an exact figure, the courts of justice have established a criterion over the years. Today, it is considered a “minor repair” borne by the tenant when it meets these three requirements:
- Low economic cost: the limit is usually set around 100 – 150 euros. If fixing something costs more than that, it is generally considered the landlord’s obligation.
- Affects minor elements: taps, lightbulbs, locks… not the structure or central services of the home.
- Cause of damage: the breakdown is due to the tenant’s daily use, not because the appliance was old.
9 – Steps to leave a rental flat in Spain
In Spain, whether before the contract expires, upon completion of the 5 or 7 years, or during an extension, to leave a rental flat and terminate the contract, the following steps must be followed:
- Provide notice within the agreed timeframe and in writing. This notice should include the exact date on which the property will be vacated.
- Leave the property in the same condition as received. This includes cleaning, leaving the house painted the same color, with no holes in the wall, or returning the original lock if the lock of the rental flat was changed.
- Document everything and take photos and videos of the flat’s condition. Ideally, the landlord and tenant should inspect the property together alongside two witnesses to avoid potential future misunderstandings.
- Sign a contract cancellation document and a key handover receipt to formalize the end of the contract. This document should specify whether the flat is returned in good condition or bad condition.
- Return of the deposit: within 30 days, it must be returned.
10 – Frequently asked questions about Spanish rental contracts
What happens if the landlord sells the rental flat or passes away?
If your landlord sells the property to someone else, the rental contract is not broken. The new buyer cannot throw you out or change your conditions simply because they bought the house. The new owner will become the new landlord. Before selling it to a third party, the landlord is obliged to offer it to the tenant first. You have right of first refusal to buy it for the same price offered to outside buyers.
In the event of death, the heirs would become the new landlords.
Can the landlord in Spain enter the rented flat?
No. The home is constitutionally inviolable. The landlord cannot enter without the tenant’s explicit consent or a court order, even if they own the property. Doing so constitutes the crime of trespassing.
Although there are specific situations where the law requires the tenant to cooperate and allow entry, it must always be with prior notice, mutual agreement, and explicit consent at that time, such as to carry out necessary repairs (Article 21.3 of the LAU).
When is the rental deposit returned in Spain?
In accordance with Article 36.4 of the Urban Leases Act, upon termination of the contract, if the property is in good condition and there are no outstanding utility bills:
The owner is required to return the deposit. The legal deadline is one month from the time keys are handed over and the contract termination document is signed.
Can the deposit be used to pay the last month of rent?
No, in Spain the deposit cannot be used to pay the last month of rent. Although the law does not explicitly state “it is forbidden to pay the last month with the deposit,” the prohibition stems from the purpose assigned to this money by the LAU itself. Article 36.1 of the Urban Leases Act establishes that handing over a cash deposit is mandatory upon signing the contract. Civil case law dictates that the deposit is a security bond intended exclusively to cover potential damage or material harm caused by the tenant to the dwelling and to cover outstanding utility bills (electricity, water, gas) that arrive after the tenant has moved out.
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