Renting out a house in Spain – Landlord and Tenant expenses

Currently, the demand for rental housing in Spain has far exceeded the supply of real estate, which has greatly increased prices to lease a home, especially in the main cities. Therefore, it is very important to be clear about the obligations of both the tenant and landlord to deal with the possible negotiations between the two parties for rent a house or an apartment.

renting a property in spain long term

The tenant must pay the Property Transfer Tax (ITP, for its initials in Spanish), a tax that must be paid in the autonomous communities, not only when you buy a home, but when you lease one. Although it is a tax that has existed for years, its payment has only been required in recent years.

The services’ registry of electricity, water and gas, for example, must be paid by the owner of the house. And the payments of specific cases such as spills, damages in the house, garbage collection, community of neighbors, etc. Who should pay them?

Below is a breakdown of the detailed expenses that each party must face in a rental housing negotiation to avoid future unpleasant situations and misunderstandings.

Not without first recommending the following:

  • That the contract of the parties clearly states the disbursements that must be made by tenant and landlord, as in fact is made clear by most of the agreements signed.
  • It is advisable for both parties to take out insurance to avoid significant disbursements in case of unforeseen home repairs.

Payments corresponding to the tenant

  • Monthly rent (which you should never stop paying to be able to claim some breach of contract).
  • Trash rate.
  • The monthly expenses in water, electricity, gas, telephone, internet connection.
  • Property Transfer Tax (according to the corresponding autonomous community. If you choose leasing in that area, verify the conditions and payment of this fee at Comarca de la Axarquía, and in municipalities such as Benajarafe, Frigiliana, Competa or Torre del Mar). You can contact us for accounting or solicitor services.
  • Damage caused by the tenant (or guests) to the property leased. To solve these situations, it is recommended to take out a tenant insurance.
  • Insurance of content and third-party liability.
  • Complaints about inappropriate noise or behavior.
  • Small and usual repairs (not exceeding 150 Euros).

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Consequently: “The landlord must carry out, without the right to increase the rent, all necessary repairs to keep the property in the appropriate living conditions to serve the agreed use, except in the event of a deterioration whose repair is attributable to the tenant according to the provisions of articles 1,563 and 1,564 of the Civil Code.”

Payment breakdown:

  • Real Estate Tax (IBI, for its initials in Spanish).
  • Supplies’ registry (water, gas, electricity, etc.).
  • Maintenance insurance.
  • The community of neighbors (quota and claims).
  • Repairs/adjustment to make the property habitable (according to the Urban Renting Act).
  • It also corresponds to the landlord the maintenance of pipes, electrical installations, replacement and repair of the thermos, refrigerator, boiler and other appliances.
  • Repairs or breakdowns that exceed 150 Euros originated over time and due to continuous use. That means that they are only exempted from minor repairs.
  • Fixing of drains and preservation of structures such as walls, roof and floors of the house.

We invite you to read other articles related to leasing or renting a house in Spain:

7 Tax-deductible expenses for House Rentals in Spain

The Treasury Department increases surveillance on seasonal or vacation rentals for tourists

The information provided in this article is not intended to be legal advice, but merely conveys general information related to legal issues.

Author: Rosana Tejada
Biographical Info: Rosana Tejada Crespo is a tax advisor holding a Master’s Degree in International Taxation. She specialises in companies and freelancers, tax regulations concerning foreign employees (Beckham Law), non-resident tax, inheritance tax and Spanish income tax. She is one of the founders of Tejada Solicitors, which comprises a group of English speaking solicitors, economists and architects.

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