Letting out a holiday home in Spain has become a major headache for property owners as a new law has helped little in clarifying an already confusing issue.
The law – LAU – has rewritten Spanish tenancy rules, but the terms are complicated, with even lawyers admitting they are unsure how to apply them.
Lawyers say this has led many holiday home owners to take their properties off the market – while others may be letting homes without a licence.
The issue is LAU should be applied by all home owners unless the property is rented for short-term holiday lets.
If it is, then regional holiday home licensing rules apply, and if no local laws are in force to take precedent, then the owners must follow LAU.
National and local rules
“This law is confusing the market,” said one lawyer in Mallorca. “Owners just don’t know what to do, so some are not letting to tourists, while others are and buyers are pulling out of sales because they don’t know what is happening.
“In the Balearics, local tourism rules apply, but the law omits some properties from the terms, like apartments, so who knows whether local or national laws apply to these properties.”
Buyers fear that if they cannot rent to tourists, mortgages will go unpaid, so are nervy about committing to a purchase.
“The situation is further complicated by the type of holiday let,” said the lawyer. “For holiday home owners providing services, like cleaning and catering, as the national law will not allow holiday lets for this kind of property and t is unclear what the local laws say.
“The whole thing is a mess and each region needs guidelines telling owners what they can and cannot do under the new rules.”
Landlord rights
Lawyers are advising holiday home owners with semi-detached or detached homes in the Balearics to apply for a licence and offer services if they want continue as a holiday let.
LAU – Ley de Arrendamientos Urbanos – is aimed at protecting the rights of landlords and tenants over long-term tenancies – which can last up to five years in Spain.
The clauses handle tenancy time limits, rents and maintenance of a property.
Many tourist areas have local laws governing holiday lets which impose licensing conditions on landlords. The Canaries and Balearics are just two regions with these licensing laws.
Expat property owners who want to let out a property as holiday lets are advised to consult a lawyer before tenants move in to check out local licensing conditions.
