Change To Rental Laws In Spain

A quiet but seismic change has just hit the Spanish housing market — and if you’re renting or planning to rent in Spain, you need to know what’s happening.

Thanks to a sweeping legal reform, tenants in Spain can now stay in their homes even after their rental contract expires — and there’s nothing landlords can do about it, at least not immediately.

The government says it’s about protecting vulnerable renters in a time of housing crisis, especially in cities like Madrid, Barcelona and Valencia, where rent prices have soared to record levels. But landlords are calling it a direct attack on property rights, and many are already threatening to pull their properties off the rental market altogether.

So, what’s changed? And how could this affect both Spanish residents and foreign expats renting property in Spain?

How Spain’s new rental law impacts locals and expats alike

The biggest bombshell in the reform is this: tenants now have the legal right to stay in their rental property even after their contract ends, as long as the contract was signed after 6 March 2019. If the landlord is an individual, the lease is automatically extended for up to 5 years. If the property is owned by a company, it stretches to 7 years — unless a clause allowing recovery for personal or family use was included from the start.

And that’s not all. In cases of vulnerability — unemployment, illness, elderly tenants, or families with young children — a judge can suspend any eviction, even in cases of unpaid rent. Tenant advocacy groups are celebrating this as a much-needed social safeguard. Landlords, meanwhile, are furious.

“This strips landlords of control over their own property,” says one Madrid-based real estate agent. “If someone stops paying and claims vulnerability, you could be stuck for years.”

The worry? Landlords will flee the long-term rental market, shifting towards holiday lets or selling their properties altogether — which could make Spain’s already tight housing supply even worse.

Spain’s rental reform sparks backlash from landlords over eviction delays

While the reform aims to balance power between tenants and landlords, many property owners argue it goes too far. They say the new law makes it nearly impossible to reclaim their property, even when the lease ends or rent stops coming in.

And the risks aren’t just legal — they’re financial. Eviction processes can now be frozen for months or even years if the tenant claims hardship. This is particularly concerning for small landlords who rely on rental income.

Faced with this uncertainty, many are pulling out. Properties that once supported stable, long-term rentals are now being shifted to short-term tourist lets or sold outright. Some communities are already feeling the impact, with a noticeable drop in available rentals — which ironically pushes prices up even further.

New rules, new limits — and why expats should pay attention

Beyond the eviction rules, the reform introduces a range of other changes designed to rein in rising rents and ease the burden on tenants:

- Rent increases are now capped based on the national inflation index (IPC).
- Security deposits are limited to two months’ rent.
- Letting agency fees must be paid by the landlord, not the tenant, if the property is owned by a business.
- Tax on primary residence rental contracts has been abolished.