Renting in Spain

The following advice was contained upon the expatica.com website and is repeated here for the benefit of members:
“There’s plenty that potential tenants should be aware of when renting an apartment or house. Here’s a guide to the small print.
Rental contract
The following provisions shall be contained in the rental contract:
* Details of landlord and tenant
* Description of the property
* The contract term
* Amount of rent and payment terms
* Any other legal provisions that the parties agree
These are only general guidelines and not definitive statements of the law, all questions about the law’s applications to individual cases shall be directed to a lawyer in Spain
The contract time period
Both parties will need to agree to the term for which the property will be rented. You may rent the property for a long or a short term. The distinction is very important as Spanish law provides with less rights to short-term tenants
Short term rental contracts
Short-term rental contracts (contrato de arrendamiento de temporada) require that the tenant vacate the property when the contract ends. This type of contract is normally used for holiday letting.
Long-term rental contracts
You can settle a long-term rental contract, which duration exceeds one year. If the contract does not exceed five years duration, it will be renewed automatically upon its expiration for periods of one up to a five years term, unless the tenant is not willing to renew it. The landlord is obliged to accept these renewals, except when he
had previously stated in the contract that he needs to recover the property for his own use before running the 5-year period. After the five years’ term, the owner may rescind the contract, provided that he had given the tenant 30 days’ notice before the end of the contract, otherwise the contract will be automatically renewed for three years, unless the tenant refuse this renewal. When the contract does not provide its duration, rental contract will run for one year. The deposit Upon signature of the rental contract, tenants are required to pay the landlord a deposit (fianza) equal to one month rent payment, in order to guarantee that the property will be returned to the owner in the same state as before the occupation. This deposit cannot be used to pay the rent to the landlord. This deposit will be returned as the tenant moves out, assuming that the property is in good conditions. After five years of rental contract, rental increase will require an increase of the deposit.
The rent
The amount of rent is agreed between both parties. Normally rent is monthly paid seven days before the end of the month. On no account must the landlord ask for more than one month rent to be paid in advance. Payments should be made as stated in the contract. Tenant shall receive a written receipt justifying that the rent has been paid, unless it is accredited by other means such as proof of payment through bank transfer. Make sure you get these receipts or any proof of payment as these constitute an implicit contract.
During the first five years, rent will be increased or reduced according to the consumer price (inflation) index (Índice de precios al Consumo – IPC). After that period, rent will increase according to what both parties agreed when signing the contract.
About the expenses
Although expenses produced for daily use of the property, such as community fees, or real estate tax (IBI), must be paid by the landlord, tenants may be required to pay them when it had been expressly agreed by both parties in the rental contract. Tenants must pay gas, electricity and telephone bills, unless otherwise is agreed. Inventory
Tenants may be required to sign an inventory of the property contents (furnishing, fixtures and fittings…) and the state of them. It is important to check this carefully, as every item outlined on the list shall be returned when you move out in the same order as listed, otherwise you might lose your deposit.
Repairs in the house
The landlord must make all necessary repairs to keep the property in a fit and habitable condition, however landlord is not responsible for repairing any damage caused by the tenant. Tenant shall make those small repairs on account of the property daily use. Urgent maintenance repairs may be undertaken by the tenant in order to avoid serious and immediate damages in the property, these must be made previous notice to the landlord, repair costs will be returned to tenant. The landlord must give the tenant three-months notice of the landlord’s intent to undertake repairs affecting to health, hygiene and comfort in the property. In this case tenant may renounce the rental contract within 1 month from the notice. If the tenant decides to stay, he may get a reduced rental rate in relation to the dwelling rooms that cannot be used because of the repairs. Do note that the above are only general guidelines and not definitive statements of the law.
Sale of the house rented. The tenant’s right of pre-emption
If the landlord wants to sell occupied property during the life of the rental contract, the tenant has the right of pre-emption (derecho de tanteo), which means that he could buy the property in priority to other purchaser. Landlord must first offer the property’ sale to tenant , who will have 30 days to reply. If the landlord does not
make this offer, or the property is sold at a lower price than the offered one, the tenant could, within one month following completion, have the sale annulled and purchase the property for the price declared in the sales’ document. Pre-emption rights’ renunciation agreement will be valid only for rental contracts that exceed five years time period. No pre-emption right can be applied when the rented house is sold together along with the rest of properties that form part of the same building. If you buy an occupied property, you acquire the rights and obligations of the vendor, and therefore, not until five-year validity period of the rental contract has been completed, may the rental be terminated. These are only general guidelines and not definitive statements of the law, all questions about the law’s applications to individual cases shall be directed to a lawyer in Spain.
Landlord/tenant’s subrogation in favour of third parties
The parties of the rental contract may be substituted for another person, who will acquire all rights and obligations of the old tenant or landlord. The landlord may be substituted when he sells the rented property to a third party.
* The tenant may be substituted when he got divorced or died. In such a case his descendants or spouse could stay in the property up to the termination of the rental contract.
Can the tenant let the property to a third party?
Previous notice to landlord, the tenant may sublet a portion of the rented property to another person for the same period he had contracted. Landlord must always give his written consent to tenant. The rent that the third person shall pay to the original tenant must be lower than that stated in the rental contract.
Taxes Landlord is liable to pay income tax at a rate of 25 percent, assuming that he is a non-resident whose Spanish property is rented. You can deduct maintenance expenses from your Spanish income tax.
Having the rental contract rescinded
a) The landlord may rescind the rental contract when the tenant:
* Does not pay the rent or deposit. * Rent the property to a third party without the landlord’s consent.
* Deliberately causes damages to the property.
* Undertake repairs without landlords’ consent.
* Causes serious nuisance to the neighbours.
b) The Tenant may rescind the rental contract when the landlord:
* Fails to make the necessary repairs to keep the property in a fit and habitable condition
* Disturb the tenant’s dwelling use
Taking action before the Spanish courts
Many problems may arise when renting/letting a property. You may disagree with your rental contract duration, the rent increase, tenant refusing to move out, tenant failing to pay the rent…
Normally, disputes regarding to rental are processed through ordinary civil proceeding (procedimiento civil ordinario).
You should report your complaints to a lawyer who will conduct your formal complaint, going to court when necessary.
21 April 2009
Article by iAbogado Servicios Jurídicos SL (Madrid, Spain). Visit www.SpainLawyer.com for more original content like this.