Updated 6 March: The Government is having another go at introducing legislation regulating rentals with Cabinet approving a new Bill last week. The legislation comes into force today but must again get Congressional approval. Unlike in February, however, when legislation failed in Congress, this time might be different because an election has been called for 28 April (see HERE), and so Parliament has been dissolved, meaning the Bill will be approved instead by a Parliamentary Committee and anyway counts on support from several minority parties: it is much likelier to succeed this time

As before, the new law extends rental contract durations from three to five years (seven if owner is a business), and restricts rent increases to the consumer price index – only applicable to contracts signed from and including today. As before, too, any required can be no more than the equivalent of two months’ rent, and contract and administration fees must be paid by the landlord if a business or other legal entity (i.e. not if the landlord is a private individual). The new legislation also incorporates the previous legislation’s protection in cases of evictions of the socially vulnerable for rent arrears: these can only take place after the Court and Social Services have arranged alternative accommodation. Finally, once again, the decree allows owners of apartments to agree to limit use for tourism. The full law is HERE.

Updated 7 February 2019: The Spanish Congress has failed to approve this legislation, and so all the law reverts to the previous measures. This means that there now will not be an increase in the period of residential rental contracts which will continue to be renewable with extensions for three years not the five the new law envisaged. Also, protections proposed for socially-vulnerable tenants will be lost, as will those concerning contract and administration fees charged by business landlords. Finally, lost too will be the reduction to 60% of the vote required for a community to change its Statutes to limit or ban future holiday letting: this will now remain at 100%. To preserve legal security, any contracts signed between 19 December and 22 January – the date the Bill was presented and the day it was rejected – will remain valid even if their terms were drawn up to comply with the new and now overturned legislation. As in the UK, the Socialist Government in Spain is a minority one and any legislation can find it fails to gain a majority in the House.

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