Advice on Spanish New Tenancy Act.
On the 18th December 2018 the Spanish Government´s Gazete published Royal Decree-Law 21/2018 which implements some changes on the previous tenancy law. This new Act favours the tenant in some of its aspects and provides more protection against landlords. The said changes were implemented and applied from the 19th December 2018 onwards. Spanish lawyer advises on Spanish Tenancy Act, see summary below:
If you own property in Spain and you are planning to rent it; or if you are planning to move to Spain and rent for 6+ months you should consider:
- The minimum period of time is now 5 years if the landlord is an individual or 7 if the landlord is a company. In case you did not know, it used to be 3 years. This means that the tenant will be entitled to stay in the property for at least 5 or 7 years. Some exceptions apply such the landlord needing the property for himself or a close relative.
- The landlord who needs the property for himself or for close relatives will have to serve a notice of two months on the tenant. Once the property has been vacated, if the landlord or close relatives do not occupy the property within 3 months, the tenant will be entitled to move back to the property. The tenant will also be entitled to compensation for damages caused to him.
If the landlord fails to serve termination notice to the tenant one month before the agreement´s expiry date, the agreement will be automatically renewed for another 3 years.
- The legal costs of the tenancy agreement and the estate agent´s fees will be borne by the landlord, if this is a company. Otherwise, it will be up to the parties to decide who pays for them. The normal practice is that all the legal costs and estate agent´s fees are paid by the tenant.
- Tenants could now be responsible for the community fees and property rates if this is agreed on the tenancy agreement.
- The deposit will continue to be 1 month for residential properties and 2 months for commercial properties. However, many landlords request 2 or, sometimes, 3 months deposit. From now on, it should be a maximum of 2 months for residential properties. Any landlord requesting 3 or more months deposit for a residential property will be breaching the law.
- The deposit needs to be refunded to the tenant within 1 month from the latter handing the keys. If not, it will accrue interest in favour of the tenant.
- Any tenancy agreements dating before the 19th December will be regulated by the articles that were of application before the 19th December 2018. This means that these changes will only apply to tenancy agreements signed after the 19th December 2018
For further information on Spanish Tenancy Agreements contact Claudia Font or Antonio Guillen