Spain is an attractive destination for both holidaymakers and long-term renters, making property rental an interesting investment opportunity. As a property owner in Spain, you can benefit from the growing demand for rental properties, whether it’s for holiday rentals or long-term leases. In this article, we discuss the key things you need to know before renting out your property, including the latest updates in the legislation for 2024.

Spain remains a popular destination for tourists and expats due to its sunny climate, beautiful beaches, and rich culture. This makes real estate renting a lucrative option, especially in tourist areas such as Costa Blanca, Calpe, and Benidorm. Renting out your property can provide a stable source of income with a good return per year, depending on location and type of rental.

There are two main categories of rentals in Spain: short-term rentals and long-term rentals.

- Tourist Rentals: Any rental shorter than 11 days falls under tourist rentals. Your property is rented out for a short period via platforms such as Airbnb or Booking.com. It is essential that your property is registered and that you have a rental license.

- Seasonal Rentals: We refer to seasonal rentals when renting from 11 days to 11 months. No specific license is required for this.

Since August 2, 2024, new rules for tourist rentals have been implemented in the Comunidad Valenciana, which includes the provinces of Alicante, Valencia, and Castellón. The government has set stricter requirements for obtaining a rental license. The new law imposes fines for non-compliance, ranging from €10,000 to €600,000, depending on the severity of the violation.

Here are the key changes:

1. Rental License: Every property that is rented, whether for short or long term, must be registered with the local government.

2. Safety Regulations: Houses that are rented must comply with stricter safety regulations, such as having an evacuation plan on the inside of the front door, a list of emergency and important phone numbers in a visible place, an approved first aid kit, and detailed information about the nearest medical center.

3. Energy Certificate: It is mandatory to have a valid energy certificate before you can rent out your property. This certificate indicates the energy efficiency of the property and must be submitted to the local authorities as part of the registration process.

4. Registration of Tenants: If you rent your property to tourists, you must register their details with the Guardia Civil or local police. This is particularly important in tourist areas such as Andalusia, where the legislation is strictly enforced.

Do not forget that rental income in Spain is taxable. You must file an annual return with the Spanish tax office (Hacienda), and depending on your residency status, tax rates may vary.

The tax rate for non-residents is 24% on gross rental income if you reside in a non-EU country. For residents of the EU, Norway, and Iceland, the rate is 19%, and they may also deduct certain costs, such as maintenance and mortgage expenses.