The Spanish Congress on Tuesday rejected the decree that sought to extend rental contracts as a means of protecting tenants from evictions and price gouging. So what does this mean for renters’ rights and price increases?
Spain’s rental contract extension had been in force since 22nd March, allowing tenants to apply for an automatic extension of their contracts for an additional two years if they expire before 31st December 2027.
During this period, the terms and conditions of the contract would remain unchanged, and the annual rent increase would be capped at two percent.
Now that the extension has been voted down, thousands of tenants have been left in limbo, without a clear understanding of what happens to their contracts now.
If you rent in Spain and your contract is due to expire before 31st December 2027, here’s what you need to know about what’s happened.
Q: What if I applied for an rental contract extension already, is it still valid?
A: Some people were able to apply for the extension while it was still in force over the past month, so what happens to those contracts? The government, consumer organisations and legal experts all argue that tenants who requested an extension of their lease between March 22nd (when the decree came into effect) and April 28th (when it was rejected) are guaranteed protection and their contracts remain valid. It is, however, a very tricky situation and many experts believe that cases could end up in court.
Q: Will I really be taken to court over my contract extension?
A: Some tenant associations believe that landlords who only own one or two properties are unlikely to resort to the courts, as it’s an expensive and timely process. If you’re contract is with a large company that owns multiple properties, however, this could be a possibility.
READ ALSO: Spain to offer 100 percent tax rebate to landlords who don’t raise rents
Q: What should l do if I have already requested an extension but haven’t received an answer?
A: If you already applied for the extension of your contract before April 28th 2026, but haven’t heard back from your landlord yet, most experts are saying that you should wait for a response. If they reject your extension, then it’s best to try and negotiate with them before taking legal action.
Q: What will this mean for rental costs?
A: The original decree stated that landlords could not raise rents by more than two percent annually. Now that this is no longer in force, the rules revert back to the previous legislation. This was that the increase is limited to the Consumer Price Index (CPI), and for contracts signed in 2023, this limit is was set at 2.5 percent.
READ ALSO: How you could prevent your rent in Spain from going up in 2026
Q: What if I didn’t apply for the extension at all?
A: If you didn’t apply for the extension before 28th April and your rental contract expires before 31st December, then you may have missed out this time, but the government has vowed to continue to try and get it approved in the future.
The Minister of Social Rights, Consumer Affairs Pablo Bustinduy told the media that the government would not remain idle and would seek a way to approve a new decree. “We will not give up and we will bring it up as many times as necessary until it becomes a reality and the right to housing prevails,” he said.
Housing Minister Isabel Rodríguez also promised to continue “fighting” for the decree extending rental agreements.
For now, however, you will have to negotiate with your landlord when your contract expires. Remember, though your rent increase should be limited to the CPI or 2.5 percent if you signed in 2023.
