Long-term rental of your property in Spain – a guide for owners

Investing in real estate is a popular and safe way to invest capital. What should you bear in mind in a country like Spain? Long-term rentals require proper preparation and knowledge of the regulations. Find out more!

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If you are interested in long-term rentals, Spain is an excellent destination. For years, the Iberian Peninsula has been attracting wealthy foreign investors who value the stability of the local premium market. What should you keep in mind when deciding to find a long-term tenant? The following guide comprehensively discusses various aspects of long-term rentals in Spain, from property preparation to tax and legal issues.

Why is Spain the best choice? Long-term rentals on the Iberian Peninsula are a well-thought-out and profitable strategy for investors who care about stable profits and financial liquidity. Unlike tourist rentals, which are dependent on the season and weather, long-term rentals provide:

• a steady and predictable monthly income,
• greater investment security,
• less wear and tear on the property,
• the opportunity to build a relationship with a responsible tenant who cares for the property as if it were their own home.

The growing demand for luxury flats and houses for long-term rental in Spain is also significant. More and more people are looking for premium properties on the Iberian Peninsula – tenants are willing to pay more for a higher standard. These are not only international managers, IT specialists or high-income digital nomads, but also wealthy families who are moving to Spain in search of a better lifestyle.

Importantly, long-term rental property in Spain is a fully passive investment, ideal for busy people living in Poland. Thanks to cooperation with an agency and professional management, the owner can reap monthly profits without having to get involved in finding tenants or solving day-to-day problems.

You may be interested in: Buying an apartment in Spain to rent out. What do you need to know?

What does premium standard look like in a country like Spain? Long-term rentals include properties offering the luxury amenities that affluent tenants expect. These are primarily high-speed fibre optic internet, a fully equipped modern kitchen, air conditioning and heating, and in the case of villas, an immaculately maintained swimming pool and garden.

Professional marketing helps to find wealthy tenants looking for an apartment or house for long-term rental in Spain. The best candidates are attracted by high-quality photos, a 3D virtual tour and a detailed description in English and Spanish that highlights the unique advantages of the property.

However, finding a wealthy candidate for a tenant is only half the battle. In the case of premium properties, the tenant verification process is the basis for investment security, minimising the risk of future problems. To this end, the candidate's financial capacity, employment contracts and even references from previous places of residence are checked.

What should you keep in mind when deciding on a long-term rental in Spain? The basis is knowledge of the Urban Leasehold Act (LAU), which regulates leases exceeding 12 months, protecting the interests of not only the tenant but also the landlord. According to local law, contracts are typically concluded for 5 or 7 years. The LAU covers, among other things:

• the minimum mandatory period of stay,
• penalties for early termination of the lease,
• rules for termination of the contract by the landlord,
• rent increases.

As in Poland, a deposit (fianza) is required in Spain. According to the LAU, it is equivalent to one month's rent, but in the premium segment, additional safeguards are applied to fully protect the interests of the landlord. These include, for example, a contractual deposit of a multiple of the rent or a bank guarantee.

The owner of a long-term rental property in Spain must also have a valid energy certificate (certificado energético) and a certificate of habitability (cédula de habitabilidad). When working with an agency, it is the agency that takes care of all legal requirements.

How to value flats and houses for rent? Spain allows you to easily optimise your profit, especially in the case of premium properties. All you need to do is develop a pricing strategy that takes into account the most important factors that affect the rental price. These are primarily:

• location,
• size,
• standard of finish,
• amenities such as a swimming pool, gym or even access to urban infrastructure.

You don't have to do this yourself – a real estate agency has experience in conducting a detailed analysis of the Spanish market. This enables it to determine the maximum and at the same time realistic rate.

In the case of long-term rentals in Spain, it is also important to bear in mind tax issues. Rental income earned in Spain by non-residents of the European Union (including Poland) is subject to non-resident income tax (IRNR). The tax rate is 19%. Importantly, this tax is paid on net income, which means that costs related to the property (e.g. interest on loans, administrative fees, depreciation, renovation costs, insurance, etc.) can be deducted from rental income.

Are you concerned about the hassle of paperwork or the distance between Poland and Spain? Long-term rentals can be easier and safer if you use an experienced estate agency.

The agency provides comprehensive support – and not only during the purchase of the property. As part of its turnkey rental management service, it takes care of marketing and advertising, finding and verifying tenants, as well as completing all formalities, including preparing the contract and handing over the keys.

What is more, the agency also provides ongoing service, becoming the sole point of contact for the tenant – it solves technical problems, oversees repairs and monitors timely rent payments. This allows the property owner to enjoy both the profits from long-term rental in Spain and complete peace of mind.

Is Spain your investment destination? Long-term rental is the next step towards capital investment and stable profits. Start by finding the perfect property with the help of the Polish agency Elite World Estates. See what apartments and villas are currently for sale on the Costa del Sol and Costa Blanca!

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Let us narrow down the search among the properties available through us, by contacting us and finding the best options for you. 
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Please enter your contact details below and we will contact you as soon as possible.

Let us narrow down the search among the properties available through us, by contacting us and finding the best options for you. We are here to help you! Please enter your contact details below and we will contact you as soon as possible.

Let us narrow down the search among the properties available through us, by contacting us and finding the best options for you. We are here to help you!
Please enter your contact details below and we will contact you as soon as possible.