The Urban Rental Law (LAU)
Spanish residential rental contracts are governed by the Ley de Arrendamientos Urbanos (LAU). Key provisions include: minimum contract duration of five years (seven if the landlord is a company), annual rent review capped at the CPI (consumer price index) or agreed index, mandatory security deposit (fianza) of one month's rent, and automatic renewal rights after the initial term if neither party gives notice.
Duration and Renewal
Under current law, if your contract is for less than five years (and the landlord is an individual), you have the right to extend it annually up to five years total. After five years, the contract continues annually unless either party gives 60 days' notice (tenant) or 4 months' notice (landlord) to end it.
Deposit (Fianza) and Additional Guarantees
The legal fianza is one month's rent for residential properties. Landlords may also request an additional deposit (garantía adicional) of one or two months. This additional deposit is legally permitted but should be specified in the contract. At the end of the tenancy, the total deposit must be returned within 30 days, minus legitimate deductions.
Rent and Increases
Rent reviews are capped by law. Since 2024, annual rent increases in Spain have been linked to a specific negotiated index (rather than the CPI, which caused issues during high inflation). Check current legislation for the applicable cap at the time of signing.
Termination Rights
As a tenant, you can leave after six months by giving 30 days' notice, losing only the remaining days of the notice period from your deposit (if relevant). The landlord can only recover the property within the initial five-year period under specific circumstances (including needing it for their own use). Always get legal advice if a landlord attempts early termination.
What to Check Before Signing
- Who is the landlord — individual or company?
- Is the property registered in the Land Registry in the landlord's name?
- Are all fixtures and fittings itemised in an inventory (inventario)?
- Are utilities included or excluded?
- Are community fees (gastos de comunidad) included?
- What is the process for repairs and maintenance?
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