Spain, and particularly its Costa del Sol region, remains a highly popular destination for property buyers and investors. However, the property landscape is continuously evolving, and staying informed about the latest laws and regulations is essential for ensuring a smooth transaction and avoiding any surprises. Here’s a rundown of some key property rules you need to be aware of, including recent changes from 2024 and early 2025.
1. Introduction of a Unified Short-Term Rental Registry
Starting from January 2, 2025, Spain will launch a national registry for short-term rentals. This initiative aims to regulate properties let out on platforms like Airbnb and Booking.com. Each property used for short-term renting will be assigned a unique identification number to help authorities monitor and enforce compliance.
This registry is expected to significantly impact certain areas by limiting the number of short-term rental properties. The goal is to tackle rising property prices driven by short-term lets and ensure responsible property usage. Property owners planning to rent out their homes for short stays must ensure their properties are registered before the law’s full implementation in July 2025.
2. End of the Golden Visa Scheme
Spain has officially ended its Golden Visa program, which allowed non-EU citizens to obtain residency by investing over €500,000 in real estate. This change, effective January 2025, reflects the government’s concerns about rising property prices and housing affordability linked to the program.
Applications submitted before December 31, 2024, will still be processed under the current rules. However, from 2025 onward, the Golden Visa will no longer be available. Investors who already hold this visa will not be affected.
3. Stricter Rental Regulations
The 2024 housing law introduced a cap on annual rent increases, limiting them to 3% regardless of inflation. Starting in 2025, rent increases will be tied to a new reference index developed by Spain’s National Statistics Institute (INE), designed to ensure more stable and predictable rent adjustments.
In areas designated as “high demand zones,” where housing and rental prices are exceptionally high, additional restrictions may apply. Property owners in these areas should stay informed about specific local regulations affecting rental income.
4. Tighter Regulations for Tourist Rentals
The Spanish government has implemented stricter regulations for properties rented to tourists. All tourist rentals must now have a valid tourism license, and property-owner communities can ban short-term lets within shared buildings. This means that if your property is part of a community, you’ll need to confirm that short-term rentals are permitted.
Failing to comply with these licensing requirements could result in hefty fines. These changes aim to address housing shortages and regulate the growing demand for holiday rentals.
5. Addressing Illegal Occupation
In 2024, Spain introduced reforms to expedite the process for property owners to reclaim homes occupied by squatters, also known as “okupas.” These reforms streamline legal procedures, making it easier for owners to regain possession of their properties more quickly. However, some experts caution that these measures may not fully resolve all challenges for homeowners.
6. Energy Efficiency Incentives
As part of Spain’s sustainability initiatives, property owners can benefit from extended tax deductions for energy-efficient improvements, such as installing solar panels, upgrading insulation, or adopting energy-efficient heating systems. These measures aim to reduce the environmental impact of housing while helping homeowners lower long-term costs.
7. Transfer of State-Owned Properties for Affordable Housing
Spain is addressing its housing crisis by transferring state-owned properties to public institutions for the construction of affordable housing. This effort seeks to alleviate pressure on the housing market and create more opportunities for low-income residents.
The property market in Spain, particularly in regions like the Costa del Sol, is undergoing significant changes. From the end of the Golden Visa program to stricter regulations on rentals, staying informed and proactive is essential for property buyers, owners, and investors. Understanding the latest legal landscape will help you make informed decisions, avoid pitfalls, and ensure compliance with new rules.
Whether you’re purchasing for personal use or investment purposes, consulting with legal or real estate professionals can provide tailored advice to navigate these changes effectively.