Spanish Housing Rental Market Analysis.
Are you thinking about renting out your property in Cambrils? Wondering what’s up with the rental scene in Spain right now? Well, I’ve got the lowdown for you. Let’s dive into the nitty-gritty of the real estate rental game!
Spain’s legal regulations for leasing and renting are laid out in the LAU (Ley de Arrendamiento Urbano) or Law of Urban Lettings of 1994. If a lease extends beyond one year, it falls under the category of a long-term contract. Generally private individual long-term rentals period tends to be 5 years, with automatic renewal unless either party explicitly indicates a reluctance to extend. The property owner must provide a 4-month notice if they choose not to renew the contract, while the tenant is typically required to give a 2-month notice in case of non-renewal.
Rental prices are reaching record highs all over Spain. This past January has seen a rise of 10.8% in rents compared to the same period in 2023, according to Idealista.
Temporary rental is one that caters to temporary needs such as work, studies, medical reasons, or vacations. The contract typically ranges between 32 days and 11 months. The controversy arising in Spain is that many landlords use these rentals to avoid adhering to the maximum rental limits imposed on regular leases. Data reveals a 58% surge in temporary rentals in the last quarter of 2023, representing 11% of the current market stock. However, regular rentals have declined by 15%. Taking Barcelona as an example, in 2019, 6% of advertisements were for seasonal rentals, and by 2023, this figure had risen to 30%.
One option for many property owners to maximize their investment is to renovate their homes, adding more rooms to rent for increased profitability.
The number of rooms available for rent has increased by 13%. In a city like Barcelona, the average monthly price for a home is 1,123 Euros per square meter, but renting a room can be half that cost. More and more people are unable to afford an entire home and are choosing to rent a room instead.
For landlords, this type of rental falls outside the housing law. With the new rental price caps, a landlord with a 100m2 apartment and a monthly limit of 1300 euros could potentially earn between 1600 to 2000 euros if rented to 3 or 4 individuals sharing the accommodation. On the other hand, specialized platforms for shared living are increasingly proliferating, especially in large cities with a high number of students.
Vacation Rentals: Finally, vacation rentals can prove to be one of the most lucrative income streams, particularly if you own a property in a coastal city or area. In Cambrils, for instance, the constant influx of visitors attracted by the beautiful weather and culinary delights makes it an ideal location.
Should you require assistance in renting out your property, please don’t hesitate to contact me, and I’ll be delighted to offer my assistance.