Renting out your property in Spain can be attractive from a financial point of view, or if you don’t want to leave the house unattented. But there are a few issues that you have to take into consideration before offering your house on the rental market.

Consult a lawyer to draft the contract. Basically, on Spanish property the Spanish law is applicable. The contract should be drafted in Spanish (but can be translated) according to Spanish law. It is not possible to rent out your property under British or other foreign laws. The only exception to this rule is made for short term rentals (less than six months) when the owner of the property lives in another country. So when you are based in England and want to rent out your Spanish for less than 6 months to another English family, then the English law can be applied.

Spanish law allows you to draft a renting contract for any period you want, but you have to remember that when the contract is due and you don’t give notice to your tenant at least 15 days upfront, the period will automatically be prolonged. When you sign a contract for one year, the tenant has the right to continue the contract year by year, up to a maximum of 5 years. You can not deny this prolongation, unless you demonstrate that you need the house for personal use as your main residence.

Causes to cancel the contract are:

not paying the rentinfraction of the conditions of the contractUse of the property for purposes that were not agreed in the contractIt is recommended to screen your tenants-to-be. Ask them for their income and/or salary slips. Although not paying the rent is a cause to cancel the contract, throwing your insolvent tenant out is easier said then done.Also a check on their behaviour isn’t a bad idea. When somebody starts illegal activities from your house, you can be in big trouble.

Make an inventory of everything in the house, and/or take photos of every room and every corner of the house. Add this inventory to the contract.

Check your insurance policy and you mortgage conditions to see what is or isn’t covered in case you rent out the property.

Normally a deposit is paid for the amount of one month of rent, you may ask for a higher amount. The rent is paid in advance, but according to the law you can’t ask for more then one monthly amount upfront.

If you rent the property out for a longer period, make your tenant pay for the water and electricity bills by direct debit straight out of his own bank account.

Take into account that you have to pay 19% taxes in Spain on the rental.

It is also important to keep an eye on the property. If you rent through an Estate Agency, make sure you have a written agreement about the responsibilities they take. Especially when you pay them a periodical fee for their services, you might expect they offer some sort of control. If they don’t, it might be a good idea to have a contact person, a neighbor or a friend that from time to time keeps an eye on the situation. You could even insert a clause in the contract that periodically ( f.i. every 6 months) the tenant will have to allow somebody into the house to have a check. Another option is to employ somebody you trust as a handyman or gardener, who will do the maintenance of the property and at the same time take a look around. In case of an argument you could use these people as witnesses.

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