CHANGES IN THE LAW OF URBAN RENTALS

Depositphotos_80480296_s-2015The new Law (Real Decreto-Ley  7/2019) concerning urgent measures with regard to dwellings and rentals came into force on 6 March 2019.
The main measures to bear in mind from now on are the following:
(1) The compulsory renewal period of a rental contract has been extended from three to five years if the owner is an individual, or seven years if a business.
Once this period is over, if none of the contracting parties objects the contract will automatically be  extended for three years.

Initially, the LAU29/1994 set a minimum five year period with an extension of three, but this was reduced in June 2013 to three years with an extension of one year.

(2) Communities of owners in residential complexes will be able to limit or set conditions on holiday letting, i.e. touristic use of the units, with a vote in favour of 3/5ths of the owners.

(3) The family situations of tenants considered as socially vulnerable will result in the suspension of eviction procedures.

The Court, when making an initial order for payment of rent, should inform a tenant that they can approach Social Services if they are in a vulnerable situation.

If Social Services consider that there are indications to confirm a situation of vulnerability, they will inform the Court the eviction should be suspended until appropriate measures are in place for a maximum of 1 month if the landlord is an individual or 2 months if a business.

(4) The landlord cannot request additional guarantees (sureties or guarantors) beyond the bond unless the contract is for more than 5 years.

(5) Contract and administration fees. 
The reform requires that contract and administration costs are paid by the owner-landlord if this is a private individual and not a business.

(6) Exemption of Property Transfer Tax.

Residential rentals are exempt from this tax. The tax is understood to be applicable only to non-residential contracts and housing that must be settled at the corresponding tax office.

Author: J. Escobedo

I am a member of the Tenerife Law Society since 1989 with a dedicated team for anyone who needs an immediate answer or long term solution to any practical or legal issues appertaining to any property or business investment in Spain. If you have decided to move to Spain to start a new life, whether that´s buying a property or a business, then you will definitely need the services of a good Spanish Lawyer who is fully conversant with Spanish protocol and who has a good command of the English language. I am based in the south of Tenerife and I am specialist in Property Law, Inheritance issues and taxes as well as Tenerife and Canarian law and a great deal more. ABOUT MY STAFF All my friendly and professional staff are fluent in English. We have been working for foreign clientes for over 25 years in Tenerife, providing legal advice and litigation services to all our clients investing throughout the whole of Spain and we pride ourselves on providing a high quality service to our clients in the form of clearer communication and advice.

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