Spain has published a new housing decree introducing automatic extensions for rental contracts and compensation of up to 12 months’ rent for tenants whose landlords refuse to renew without justification.
The royal decree-law appeared in the Official State Gazette (BOE) on Thursday and is due to enter into force on Friday.
However, its future remains uncertain because it must also be approved by Congress, where the government is not guaranteed enough support.
The measure was demanded by the Tenants’ Union and the left-wing Sumar party.
It accompanies a separate housing decree covering evictions, temporary and room rentals, property investment funds, tourist accommodation and assistance for first-time buyers.
Compensation
Under the new rules, landlords who decline to extend a rental agreement without an accepted justification could have to compensate the tenant.
The payment would be equivalent to 12 months’ rent for a comparable property, calculated using Spain’s official rental-price reference system.
It could never be lower than one month’s rent for every year the tenant had lived in the property.
However, compensation would not apply when the landlord has a legally recognised reason for recovering the home.
These exceptions include cases in which a private landlord requires the property for themselves or a relative within the second degree of kinship.
If the landlord or relative then fails to occupy the property within three months, the former tenant could become entitled to compensation.
The exemption could also apply when the tenant does not genuinely use the property as their main home or owns another suitable home in the same municipality.
Minimum five-year tenancy
When a new contract is signed for the same home, it must guarantee the tenant a minimum stay of five years.
That period will increase to seven years when the landlord is a company or another legal entity.
The new rent must follow the applicable price-setting rules, even when the property is not located in an officially declared stressed housing area.
The decree also prevents landlords and tenants from agreeing voluntary extensions shorter than the legally established periods. Clauses changing the original contract’s conditions during such an extension would be considered invalid.
Extra protection
Tenants whose contracts are being terminated may request an extraordinary extension lasting up to one year if they can demonstrate social and financial vulnerability.
They will need a report or certificate issued within the previous year by municipal or regional social services.
A landlord classed as a large property owner will be legally required to accept the extension.
Different rules in stressed areas
Additional protections will apply to homes located within designated stressed housing areas.
Once the standard mandatory extension period has ended, a tenant may request that the agreement be renewed annually for up to three further years.
The landlord will be required to accept the request, and the original contractual conditions will continue to apply throughout the additional period.
The government argues that the measures will provide greater stability for tenants and the rental market without restricting the supply of homes or undermining landlords’ legal certainty.
The decree’s survival now depends on Friday’s vote in Congress.
