11 Month Rental Contracts in Spain

GB Abogados are frequently contacted by individuals with questions regarding 11 month rental contracts in Spain.

The use of, what is essentially classed as a seasonal rental contract, for properties intended as the main residence for the tenant is becoming increasingly common.

This type of agreement is especially prominent in touristy areas of Spain. Often in these locations the landlord, tenant, agent or all three can be foreign nationals.

It seems to be considered acceptable in these circumstances to try to sidestep Spanish law by offering a contract which is not legal for a main residence.

La Finca, Algorfa, Alicante

These seasonal rental contracts are typically 11 month contracts.

The intention is to prevent the tenant from gaining the right to remain in the property for 3 years as per Spanish law.

The contracts therefore are a clear case of avoiding application of the law and the rights of the tenant.

Seasonal rental contracts (or holiday rentals), unlike regular principle residence rental contracts, are not defined by rental law and the parties can freely establish the term of the contract.

In this way, the obligation of the landlord to allow the tenant to extend is avoided and the tenant cannot remain for 3 years as stated in the law.

WHAT IS THE MINIMUM DURATION OF A PRINCIPLE RESIDENCE RENTAL AGREEMENT?

Whatever the duration agreed between the landlord and the tenant, the contract can be extended up to 3 years.

During this period, the tenant is entitled to terminate the contract once 6 months have elapsed. The tenant can give 1 months notice to terminate the agreement.

In which case, the landlord will not be entitled to any type of compensation, unless it is established in the contract.

WHAT DOES THE LAW SAY?

Article 9.1 establishes that, in relation to the minimum term:

The duration of the rental contract will be freely agreed by the parties.

If this is less than three years, on the day of expiration of the contract, it will be mandatory for annual periods until the rental contract reaches a minimum of three years, unless the tenant manifests to the landlord, at least thirty days in advance at the date of termination of the contract or any of the extensions, its willingness not to renew it.

For example, even if in your contract you signed contains the following clause: “either of the two parties can terminate the contract after 6 months have elapsed since the signature”, you are entitled to remain for 3 years since that clause is contrary to law and therefore null and void.

CONCLUSION

Seasonal or holiday rental agreements are solely for use when the let is short term and the tenant has a primary residence elsewhere.

The practice of drafting 11 month rental contracts when the tenant intends to reside in the property, can have repercussions for both the landlord and the estate agency.

There is significant momentum in Spain towards tighter regulation of property rentals.

The last 12 months have seen widespread clampdowns on holiday rentals in holiday hotspots.

If you are a landlord or a tenant and would like advice in relation to any matter relating to renting a property, please don´t hesitate to contact us.