New property regulations in Spain. What’s changing for owners, buyers and investors?

The new regulations governing the Spanish property market focus primarily on the residential rental market. They amend the rules concerning contract renewals, rent reviews, seasonal lettings, certain tax reliefs and tenant protection. They also introduce new measures relating to large property owners and selected institutional investors.

What changes do Decrees 26/2026 and 27/2026 introduce, and what do they mean in practice?

In recent days, there have been numerous reports in the media suggesting that Spain is bringing about a revolution in the property market. There have also been numerous comments suggesting that property investment is no longer profitable or that there will be a ban on letting. In reality, the picture is far more complex.

At the same time, it is worth emphasising that the new regulations do not prohibit European Union citizens, including Poles, from purchasing property. It is still possible to buy flats and apartments in Spain; however, anyone planning to let them out should familiarise themselves with the new regulations.

The legislation is still going through the parliamentary process

Royal Decrees Nos. 26/2026 and 27/2026 were published and came into force on 1 and 2 October 2026 respectively .

It should be borne in mind, however, that these are decrees with the force of law which – under the Spanish legal system – still require approval by the Congress of Deputies within 30 days of their publication.

If Parliament approves the decrees, they will remain in force. If, however, they do not secure the required majority, they will cease to have legal effect from the moment the result of the vote is published.

What does this mean, and what are the key changes?

As at the date of publication of this article, the new regulations are in force; however, it is worth keeping an eye on the legislative process as it unfolds, as some of the provisions may still be subject to change.

The new regulations provide, amongst other things, for:

• a change to the rules governing the renewal of tenancy agreements for flats serving as a permanent place of residence,
• new obligations regarding the termination of contracts by owners,
• the possibility of paying compensation in certain cases where the contract is terminated,
• new rules on rent reviews,
• a prohibition on passing on to the tenant the costs of drawing up and administering the tenancy agreement,
• clarification of the rules governing seasonal lettings,
• new regulations on room lettings,
• changes to tax relief for flat owners,
• the possibility for some tenants to claim a portion of their rent as a tax deduction,
• new measures relating to VAT and IBI tax,
• extending protection against eviction for selected groups of tenants,
• restrictions on the purchase of flats by certain investment entities.

However, this does not mean that all the changes apply to every property owner. Many of the new provisions relate exclusively to specific types of tenancy or particular situations.

Three types of tenancy in Spain

Much of the information published in the media fails to explain that Spanish law distinguishes between several types of tenancy. Yet it is precisely this distinction that determines which regulations will apply.

1. Long-term tenancy (primary residence)

This is a tenancy agreement entered into with a person who regards the rented flat as their permanent place of residence.

It is precisely this type of tenancy that has been subject to the greatest number of changes in Decrees 26/2026 and 27/2026.

Changes relating to contract extensions, rent reviews and tenant protection – in most cases, these relate specifically to long-term tenancies.

2. Seasonal let (alquiler temporal)

This is the issue that is currently raising the most questions. Seasonal tenancies are intended solely for people who are temporarily staying away from their usual place of residence for a specific, valid reason.

This could be, for example:

• carrying out work,
• university studies,
• training,
• work placement,
• completion of a work-related project,
• other documented circumstances justifying a temporary stay.

The new regulations make it very clear that the reason for entering into a contract must be stated in writing and – where necessary – documented.

It is in this area that the greatest number of new regulations have been introduced.

3. Holiday let (vivienda turística)

A holiday let is a short-term let for holidaymakers.

It is subject to separate laws and regulations in force in the individual autonomous communities.

Can Poles still buy property in Spain?

This is one of the most frequently asked questions following the announcement of the new regulations. The answer is: yes.

The decrees do not prohibit European Union citizens from purchasing property, nor do they restrict the ability of private individuals to buy flats.

People planning to buy a holiday flat, a house or a flat as an investment can still purchase property on the Spanish market.

The changes primarily concern the way in which property is let and certain rules governing the housing market.

What does this mean in practice? If you’re planning to buy a property in Spain, the new regulations shouldn’t put you off investing. However, it is worth considering at the purchase stage whether the property will be for your own use, long-term let, seasonal let or holiday let, as each of these models is subject to different regulations.

Who are the new regulations aimed at?

Although there is a great deal of talk about these changes, in practice they do not affect all property owners to the same extent.

They will be of the greatest importance to:

• owners of flats let as the tenant’s permanent residence,
• people planning to enter into new tenancy agreements,
• owners who let their properties on a seasonal basis,
• investors with larger property portfolios,
• people planning to make use of tax reliefs relating to letting.

However, if you use the property solely for your own purposes or as a holiday home, most of the changes described will not apply directly to you.

Will the owner have to extend the property’s tenancy agreement?

First and foremost, it is worth emphasising that the changes apply exclusively to long-term tenancies (vivienda habitual), i.e. situations where the rented property is the tenant’s permanent residence. They do not automatically apply to seasonal or tourist tenancies.

New provisions – set out in Decree 27/2026, amending, amongst other things, the provisions of Article 10 of the LAU (Ley de Arrendamientos Urbanos) – provide that, upon expiry of the minimum term of the tenancy agreement, it shall be renewed for a further 5 years, and where the landlord is a legal person (e.g. a company), for 7 years.

At the same time, each party retains the right to terminate the tenancy agreement, but must comply with the statutory notice periods. The landlord should give the tenant at least six months’ notice of their intention to terminate the tenancy, whilst the tenant must give two months’ notice.

When might a landlord be liable to pay compensation?

One of the most significant new provisions set out in Decree 27/2026 concerns compensation in the event that a tenancy agreement is not renewed.

Under the proposed arrangements, if a landlord decides to terminate the tenancy agreement without any of the circumstances provided for in the Act arising, they may be required to pay compensation to the tenant.

Its value may be:

• an amount equivalent to at least 12 months’ rent for a comparable flat, or
• the equivalent of one month’s rent for each year of residence, whichever is the higher.

It is worth noting, however, that the legislation also provides for a number of exceptions in which the obligation to pay compensation will not apply.

When will compensation not be required?

The decree sets out several situations in which the owner will be able to terminate the contract without being obliged to pay compensation.

For example, this applies to situations where:

• the owner needs a flat for themselves or their immediate family members,
• the parties will sign a new tenancy agreement,
• the tenant rejects the proposal for a new tenancy agreement – one that meets the conditions set out in the Act,
• the tenant has another flat in the same local authority area which can meet their housing needs, and the landlord will be able to prove this.

However, each of these situations requires that certain conditions, as laid down in the legislation, be met.

Merely invoking the owner’s need to use the flat will not always be sufficient. If, once the tenancy has ended, the premises are not used for the stated purpose, the law provides for the tenant to be able to assert their rights.

Who is a so-called ‘major property owner’?

The term‘major shareholder’ (gran tenedor) appears repeatedly in the new legislation.

This is important because some of the new obligations and restrictions will apply specifically to this group of owners. As a general rule, a ‘large owner’ is defined as a person or entity that holds:

• more than 10 municipal residential properties, or
• over 1,500 m² of living space.

In certain areas with a high demand for housing, the autonomous communities may lower this threshold to as few as five residential properties.

Most people buying one or two flats in Spain will not be classified as ‘major property owners’. This definition is primarily relevant to larger investors and entities with extensive property portfolios.

Will it still be possible to increase the rent?

Yes, but the new regulations set out additional rules regarding rent reviews.

Until 31 December 2027, the rent may not increase if it exceeds the reference rate. In all other cases, it increases in accordance with the agreed terms, or, in the absence of such terms, by a maximum of 2 per cent.

If the tenancy agreement provides for the possibility of rent adjustments, any increase must not exceed the limits set out in the new legislation. However, in the absence of relevant provisions in the tenancy agreement, the statutory limits will apply.

In practice, this also means that, in many cases, rent increases will be linked to the new IRAV index, which replaces the arrangements previously in place.

Can the landlord still charge the tenant for the costs of drawing up the tenancy agreement?

Under the provisions set out in the decrees, the landlord will not be permitted to pass on to the tenant the costs of preparing, concluding or renewing the tenancy agreement.

The new regulations also stipulate that a landlord will not be able to require a tenant to take out insolvency insurance as a condition of entering into a tenancy agreement.

Before signing a new tenancy agreement, it is worth reviewing its terms and checking what charges are set out in it. This will ensure that both the landlord and the tenant can be confident that the agreement complies with current legislation.

Will seasonal rentals still be possible?

This is one of the biggest concerns for property owners following the announcement of the new regulations.

The answer is: yes – however, the new regulations define seasonal letting much more precisely and specify when it can be used.

The new regulations stipulate that seasonal rentals (alquiler temporal) are intended solely for people who are temporarily away from their permanent place of residence – for a specific and verifiable reason.

These may include, amongst other things:

• carrying out work,
• university studies,
• training,
• work placement,
• completion of a work-related project,
• other legitimate circumstances requiring a temporary stay.

The mere intention to sign a lease for a shorter term will not be sufficient. The reason for the tenancy must be specified in the lease, and in the event of a dispute, the landlord will have to prove that it did in fact exist.

How long can a seasonal tenancy last?

The new regulations also provide for a more precise definition of the duration of such a contract. As a general rule:

• a holiday let should last for more than 31 days,
• generally no longer than 12 months.

However, if the reason justifying the stay continues to exist, the parties may extend the contract, provided they expressly agree to do so.

The mere fact that a tenancy agreement is for 11 or 12 months does not in itself mean that it will be regarded as a seasonal tenancy. The key factor is the purpose of the tenant’s stay, not merely the length of the tenancy agreement.

When can a seasonal contract be regarded as a long-term tenancy?

This is one of the most significant changes introduced by the new regulations. If the actual reason for the seasonal tenancy is not specified in the tenancy agreement, or if it cannot be documented, the tenancy may be treated as a long-term tenancy (vivienda habitual).

A similar situation may also arise when:

• the tenancy lasts for more than 12 months without justification,
• Successive seasonal tenancy agreements are being concluded with the same tenant for the same flat, with the aim of ‘circumventing’ the regulations on long-term tenancies.

In practice, this means that the choice of contract type should not be left to chance. The landlord should tailor the tenancy arrangement to the tenant’s actual use of the property.

What changes when you rent out rooms?

The new regulations also apply to the letting of individual rooms. Under the proposed measures, letting a room will be treated as a form of letting a flat, and the total rent charged for all rooms may not exceed the amount that could be obtained from letting the entire property.

In areas with a high demand for housing, the current rent caps will also apply. Those letting rooms should check whether the rent they are charging complies with the new rules. In the case of new tenancy agreements, it is also worth ensuring that their terms take account of the current regulations.

Is it possible to sell a flat that is currently let?

Yes. The new regulations do not prohibit the sale of a property covered by a tenancy agreement. At the same time, they strengthen tenant protection in certain situations and set out additional rules regarding certain transactions.

That’s why, before you start selling, it’s worth checking:

• what type of contract is in force,
• until when it was concluded,
• what rights a tenant is entitled to under the applicable legislation.

How are the rules on evictions changing?

The new regulations also provide for a further extension of protection for certain tenants who find themselves in difficult circumstances.

In accordance with the provisions set out in the decrees, in certain cases the court will be able to suspend eviction proceedings until alternative accommodation has been secured for the family or the authorities have taken action.

However, this does not mean that every eviction will automatically be suspended. The extent of the protection depends, amongst other things, on the tenant’s circumstances, the type of landlord and the circumstances of the specific case.

The regulations lay down different rules for private individuals who own a small number of flats than for large-scale owners or investment entities.

What do the new regulations mean for investors from Poland?

Most buyers from Poland purchase one or two flats in Spain – as a second home, a holiday flat or a rental investment.

For such owners, the most important thing will be, above all, to ensure that the tenancy arrangement is properly tailored to the intended use of the property.

The new regulations may, however, be of greater significance to investors who hold extensive portfolios of flats or who conduct their business through companies. In their case, it is worth keeping a close eye on changes to the regulations and their impact on planned investments.

What tax changes do the new regulations provide for?

One of the most important elements of the new regulations is the changes relating to the taxation of residential lettings. The aim of the proposed measures is to encourage landlords to make flats available for long-term lets and to increase the supply of flats on the market.

In practice, this means that some property owners will be able to benefit from new tax reliefs, whilst in some cases the tax rules for certain letting arrangements will also change.

What tax reliefs might a flat owner be entitled to?

The proposed legislation provides for changes to personal income tax (IRPF) for landlords.

The amount of the relief will depend, amongst other things, on:

• the type of contract entered into,
• the amount of rent,
• the location of the property,
• the tenant’s age,
• whether the owner is regarded as a ‘major owner’.

In certain situations, tax relief may range from 15 per cent to as much as 100 per cent of rental income. The proposed measures include, amongst other things:

• the highest tax relief for landlords who reduce the rent when signing a new tenancy agreement,
• priority for flats let to young people,
• additional benefits in areas with a high demand for housing,
• separate arrangements for flats let under social housing schemes.

In practice, this means that each situation should be assessed on a case-by-case basis. The amount of the tax relief depends on a number of factors, so before signing a new contract, it is worth checking whether the chosen tenancy arrangement allows you to benefit from the available tax incentives.

Can a tenant also claim the tax relief?

Yes. The proposed legislation provides for the possibility of deducting part of the rent paid by those who meet certain conditions.

Tenants whose taxable income does not exceed €33,007.20 may deduct 10 per cent of their rent (up to €1,163 per year), whilst landlords who are not ‘large property owners’ are entitled to personal income tax (IRPF) relief ranging from 15 per cent to 100 per cent – depending on the amount of rent and the location.

Entitlement to the relief is subject to all the conditions laid down in the regulations being met, including, amongst other things, the tenant’s income and financial circumstances.

What changes are being made to VAT on short-term lettings?

Another significant change is the extension of VAT to certain forms of short-term letting.

The proposed legislation provides that, from 1 December 2026, certain types of lettings of furnished flats will be subject to VAT at a rate of 10 per cent.

This applies primarily to short-term lettings and services similar to those provided by hotels.

However, not every letting will be subject to VAT. The scope of the new regulations depends on the type of services provided and the letting model. It is therefore worth checking, before starting your business, whether the way you plan to let your property will be subject to the new rules.

Will there be any changes to property tax (IBI)?

The proposed legislation also provides for the possibility of increasing the IBI tax on certain properties that have remained vacant for a long period of time.

The new measures are intended to enable local authorities to apply higher tax rates to flats that have been left unused for a long period without a valid reason.

Additional measures have also been put in place for selected properties intended for holiday let in areas with a high demand for housing.

In practice, this means that not every property will be subject to a higher tax. Whether the increased rates can be applied will depend on the decisions of individual local authorities and on whether the conditions set out in the legislation are met.

Summary

New decrees concerning the housing market in Spain introduce a number of changes that may be of significance to both property owners and those planning to buy a property or invest in the Spanish market.

Most of the new measures relate to long-term tenancies, the rules for extending tenancy agreements, rent reviews and new regulations concerning seasonal lettings.

At the same time, it is worth bearing in mind that not all of these changes apply to every property owner. The scope of their application depends primarily on the type of tenancy, the owner’s status and individual circumstances.

Given that some of the new measures are still going through the parliamentary process, it is worth keeping an eye on the progress of the legislative process and regularly checking the current legislation.

If you are planning to buy a property, sell a flat or enter into a new tenancy agreement in Spain, it is worth assessing your situation in advance and ensuring that your planned actions comply with current regulations.

This article was compiled on the basis of:

• Royal Decree-Law 26/2026,
• Royal Decree-Law 27/2026,
• Urban Tenancy Act (LAU),

This article is for information purposes only and has been prepared on the basis of the content of the proposed measures and published decrees. As the legislative process is still ongoing, some of the provisions may still be subject to change once the parliamentary procedure has been completed.

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