Written By María Hurtado de Mendoza
In recent years, the vacation rental market in Spain has experienced significant growth. This trend has been driven by large rental platforms that have made it easier to rent out tourist properties across the country. Since the pandemic, this has boosted the tourism sector. However, this popularity has also brought a series of challenges and controversies, affecting property owners, cities, and the general public.
During the summer, government spokespeople announced that they are working on regulatory development for Article 3 of Law 29/1994, on Urban Leases, which governs leases for uses other than residential. The purpose of the new regulation is to protect temporary rentals for people who genuinely need them. Under this regulation, property owners offering short-term tourist rentals will be required to prove and justify the reason for formalizing the rental contract. It was also announced that the decision-making power of Homeowners’ Associations regarding the prohibition or limitation of tourist rentals in their buildings would be “clarified.”
Additionally, the government has stated that it will implement EU Regulation 2024/1028, which sets standards for harmonizing information and handling data from short-term rental contracts. A single registry will be created, where all short-term rental contracts must be recorded, whether seasonal or for tourism, as long as they are advertised on an online platform.
At the same time, the Ministry of Housing is working on amending Law 49/1960 on Horizontal Property, which will require all tourist rentals to obtain authorization from the Homeowners’ Association in the building where they are located.
Until now, since 2019, the law allowed property owners to rent out their homes for tourist purposes, and if complaints arose from other owners, the neighborhood association could limit or condition the tourist rental. This required a three-fifths majority vote.
The proposed amendment being considered by the government aims to give Homeowners’ Associations more preemptive control. This means that neighbors could veto the establishment of tourist rentals if three-fifths of the owners vote to do so, before such economic activity begins.
This is a measure that, although not explicitly stated, was already implied in the most recent amendment to the Horizontal Property Law on December 27, 2023. By the end of 2023, the Supreme Court had already established that Homeowners’ Associations have the authority to veto such vacation rentals. The goal of this new amendment is to explicitly recognize this possibility and regulate the process for passing resolutions that prohibit tourist rentals.
These upcoming changes, expected to be introduced in the coming months, add to those approved in recent years, which seek to provide stability and create a regulatory framework in a highly controversial, politicized, and constantly evolving matter. However, we will need to wait and see which measures are ultimately approved, and we will summarize them in a future publication.
