Spain is facing a potential renting crisis after it emerged that almost half of landlords whose tenancy agreements are ending next year will pull their homes from the long-term market.
The worrying figures come from a survey by leading property portal Fotocasa, released in November.
Head of Research Maria Matos branded the sector’s current state as ‘desangrado’ – bleeding out.
According to Matos, next year will see the expiry of thousands of tenancy agreements signed under Spain’s 2019 Urban Tenancy Law (LAU) reforms, with many landlords preparing to walk away from long-term renting altogether.
Fotocasa surveyed property owners and found:
- 43% will remove their home from long-term rental
- 16% will switch to seasonal lets
- 11% will move to tourist rentals
- 6% plan to rent individual rooms
- 23% intend to raise rent prices
This shift is already visible in 2025, but Matos says the real rupture will come in 2026, which is the year many pandemic-era contracts reach their natural end.
The result, she predicts, will be a market with virtually zero rotation and fierce competition for every listing.
‘Tenants are facing impossible castings and exorbitant prices, while landlords try to protect themselves from defaults, damage or illegal occupation,’ Matos explained.
Fotocasa is blunt about the root cause, saying it is down to state intervention in the rental market.
‘This is a diagnosis error,’ Matos said, ‘You cannot protect only vulnerable tenants without offering guarantees to landlords.’
With 90% of Spain’s rental supply coming from private individuals, policies that cap prices, restrict evictions or impose obligations without incentives are, she argues, pushing owners out of the system.
‘If we keep intervening without understanding how the market works, we will only make it smaller.’
Between 2022 and 2024, the share of Spaniards intending to buy a property to rent out rose from 7% to 13%.
But in 2025 it has fallen back to 10%, representing a significant drop that signals diminishing confidence and growing legal uncertainty.
Meanwhile, seasonal rentals are up 40%, while controversial tourist rentals are up 55%. And in many cities, there are now more room rentals advertised than entire homes.
In another sign of the times, large institutional investors are abandoning build-to-rent projects in Spain, citing excessive intervention and a lack of incentives.
According to the Fotocasa survey, a major shift back toward homeownership may be brewing.
Fotocasa’s data reveals:
- 21% of Spaniards plan to buy a home in the next five years
- 8% aim to buy within two years
- 80% are searching for a primary residence
- Only 10% are buying to invest
‘The idea of emancipating through renting is collapsing,’ Matos said. ‘People want stability, and renting no longer provides it.’
Read more Spain news at the Spanish Eye.
