Spain is one of the most popular tourist destinations in the world, receiving 85 million tourists in 2023, as stated by Statista, the German online data collection platform. Catalonia and Barcelona in particular, being the region that the vast majority of tourists chose to visit. Many visitors elected to stay in short-term rental apartments in Barcelona, as opposed to hotels, mainly driven by the flexibility, comfort and cheaper costs. The advantages of apartments over hotels may be drawing to a close in light of Jaume Collboni, the mayor of Barcelona's radical plan to abolish short-term rental apartments intended as tourist lets by 2028. However, at the present time the proposal is at the planning stage and it is likely to be some time before the proposal is enacted.
Jaume Collboni's drastic move is driven by economics as the boom in short-term rental apartments for tourists has risen year on year driving up the cost of living in Barcelona with an escalation in rents of up by 70% in the past ten years, together with an increase of nearly 40% in the cost of house purchase. Many Spanish nationals are now unable to afford to buy a property, leaving young adults in particular in an impossible position. Jaume Collboni commented in El Pais "..."We cannot permit that the majority of young people who wish to leave home also have to leave Barcelona..."
A number of factors contributed to the decline of Barcelona's economic stability, the 2017 referendum and the Catalan parliament's declaration of independence triggered a swift exodus by commercial entities with 3,000 companies having moved or announced the imminent relocation of their headquarters within weeks. Major banks such as CaixaBank and Banco Sabadell relocated to other parts of Spain to safeguard their position under the jurisdiction of Spanish and European Union law. These actions created a negative impact on the local economy together with the reduced tourist income experienced by hotels and the failure of many owners of short-term rental apartments to obtain the appropriate licences and pay the required taxes. The negative effect on the economy has proved hard to reverse.
Sergio Filonenko Kibu, an Associate, pointed out "the compound reasons for the change of economic circumstances in Barcelona and the spiralling costs of property purchase resulting in local inhabitants being priced out of the city has driven the mayor to consider such extreme measures. Care must be taken to avoid a "boomerang" effect of a mass exodus of tourists damaging the economy still further." Sergio suggested "Without doubt, the illegal short-term rental apartments must be clamped down on which will go some way to remedy the situation. Regardless of the eventual decision with respect to Barcelona's short-term rental apartments, tourism provides a significant market for this type of investment in many areas of Spain."
Giambrone and Partners Spanish real estate lawyers point out that as many of the17 regions in Spain are autonomous, the rules for the short-term rental apartments can vary from region to region. Foreign investors still have the opportunity to develop a portfolio of short-term rental apartments aimed at the tourist sector in other regions. It is important, if you are considering operating a short-term rental apartment in Spain, to clearly understand the specific regulations in the region and municipality you are considering. You are strongly advised, due to the complexity and variability of these rules, to seek expertise legal advice to ensure compliance and avoid the substantial financial penalties invoked for breaches.
Brief General Overview of Licensing Rules for Short-term rental apartments
Rules for All
In all regions, the property to be rented must provide the basic requirements:
- All living rooms and bedrooms must be directly ventilated through an exterior wall – a window or patio door
- Shutters or blinds must be provided to darken the windows
- Hot water
- First aid kit
- A lift is the apartment is located on or above the 4th floor
- A complaints book
- Single-room occupancy is frequently not permitted
In some regions a licence does not attract a fee in others a fee is payable
Andalusia
- Licences apply to apartments rented out for under two months
- If more than three apartments are owned within the same building or within a one-kilometre radius the properties must be registered as tourist apartments
- Registration authority – regional Government of Andalusia Ministry for Tourism and Sport
Aragon
- One-month maximum rental term
- Single-room occupancy prohibited
- Ownership of multiple apartments must be registered as tourist apartments
- Registration authority – Virtual Citizen Care Office
Asturias
- Properties available for rent – holiday homes and country houses must be made available from July to September
- Single-room occupancy prohibited
- Rentals must be over 30 days
- Registration authority – Tourist Companies and Activities Registry of the Principality of Asturias
Balearic Islands
- Maximum number of rooms six for a maximum of 12 guests.
- Licences issued for detached houses only
- Licences require the provision of hotel services
- Short-term basic rentals do not require a licence
- Registration authority – General Registry of Tourist Firms, Activities and Establishments in the Balearic Islands, Island Council of Mallorca
Basque Country
- Maximum number of rooms six for a maximum of 12 guests.
- Ownership of two or more properties requires a licence.
- Registration authority – Tourist Companies and Establishments Registry
Canary Islands
- Single-room occupancy prohibited
- Information regarding all guests must be registered with the local police
- A property designated as residential in a tourist complex may be rented through an agent and assigned to the complex if it holds a tourist licence
- Registration authority – Inter-Island Council
Cantabria
- Single-room occupancy prohibited
- All types of short-term rental property must be registered
- Registration authority – Department of Tourism
Catalonia
- Periods of letting in excess of 31 days are not considered tourist rentals
- Property owners may only rent two single rooms if they are also resident in the property.
- Issuance of licences has been suspended in anticipation of the new regulations
Glaicia
- The maximum number of guests in a home limited to ten
- Single room occupancy prohibited
- Registration authority – Department of Tourism
Madrid
- Five-day minimum rental period
- Single occupancy prohibited
- Property must have the facility of Wi-Fi
- Registration authority – Post Office
Navarre
- Country lodge traditionally built in style
- Properties built in the modern style are tourist accommodation
- Registration authority – Department of Tourism
Valencia
- Five or more properties must be registered as a tourism company
- Registration authority – Department of Tourism or Post Office
Other regions in Spain have the capacity to have short-term rental apartments registered but there is very little demand for rural properties as short-term rental apartments for tourists. Giambrone & Partners' real estate lawyers can assist at every stage with short-term rental apartments.
Sergio Filonenko Kibu is an Abogado (qualified Spanish lawyer) and is admitted to practise in England & Wales as a Registered Foreign Lawyer (RFL). He is an associate based in the London office.
Sergio assists commercial clients with a range of contentious and non-contentious matters. He is a highly regarded, astute lawyer advising on challenging cross-border disputes, including debt collection, contractual disputes and breach of contract. Sergio advised on a complex high-value international financial disputes across several jurisdictions. He also assists businesses with drafting shareholder agreements, share purchases, mergers and acquisitions and security agreements.
Sergio has extensive experience assisting high-net-worth individuals with the acquisition of real estate, both residential and commercial, in excess of €10 million across the globe. Sergio's meticulous due diligence, with regard to large commercial real estate transactions, ensures that the investment is sound and also limits the exposure to risk, providing an outcome in line with the clients' objectives. He is also able to assist with regulatory issues surrounding such investment.
He aso leads the Ukrainian division and is assisting Ukrainian clients with immigration applications for visas for Ukrainians with family members in the UK, as well as applications for visas for Ukrainian citizens wishing to join their relatives in Italy, Spain, and Portugal. Sergio will guide the applications working closely with each country's government department to accelerate the visa applications.
Furthermore, Sergio can advise private clients on inheritance, drafting wills for foreign nationals with overseas assets including Spanish real estate, he can also assist with probate and inheritance disputes. Sergio also advises on cross-border divorce, establishing the financial and child arrangements. With regard to criminal defence Sergio has assisted British nationals arrested in Spain for various offences.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.