Concept
A Permanent Rental is considered to be one that falls on a habitable building, whose primary purpose is to satisfy the tenant’s permanent need for housing.
Therefore, for the lease to have this character, the following requirements must be met:
– That it is a building, that is, an architectural structure attached to the ground (CC art.334.1Âş); and
– That the habitable building satisfies the tenant’s permanent need for housing .
The legal regime applicable to the rental of the dwelling also extends to the annexes to it (furniture, storage rooms, parking spaces, terraces, gardens…), provided that the following requirements are met (LAU art.2.2):
– That they are accessories to the rented dwelling, although they do not need to be part of the same building, it is only required that they be located in a place that allows them to be used as dependents of the dwelling; and – that its use is ceded by the same lessor.
If the landlord of the dwelling is not the same as the landlord of the accessory element, the lease of the latter is considered for use other than housing.
Duration- Minimum legal term
The minimum legal term of lease contracts is currently 5 years, if the landlord is a natural person (individuals), and 7 years if it is a legal entity (companies). It consists of the contractual term, that is, the one agreed by the parties and, where appropriate, a series of annual extensions until this minimum period indicated by the regulation is reached.
Mandatory annual extension
Although the duration of the lease is that agreed by the parties, when the term set is less than 5 or 7 years -depending on whether the landlord is a natural or legal person-, once it has ended, there is a mandatory annual extension for the landlord, until the lease reaches that duration. These extensions are voluntary for the lessee, who may withdraw from them at any time.
Contract
Minimum information
Likewise, with effect from 26-5-2023, the Law on the Right to Housing has established a series of measures that provide transparency and protection to consumers in the rental of housing. In this sense, the minimum information that must be provided to the interested party who requires it is the following:
- Identification of the lessor and, where appropriate, of the natural or legal person involved, within the framework of a professional or business activity, for the intermediation in the operation.
- Economic conditions of the transaction: total price and concepts included, as well as the payment conditions that, if applicable, may be established.
In the case of the lease of a dwelling that is located in an area of a stressed residential market, the owner and, where appropriate, the intermediary, must indicate this circumstance and inform, before formalising the lease, and in any case in the contract, of the amount of the last rent of the lease contract for the main residence that would have been in force in the last 5 years in the same dwelling. as well as the value that may correspond to it in accordance with the reference index of housing rental prices that is applicable.
- Essential characteristics of the home and the building, including:
– Certificate of habitation or certificate/license of occupancy;
– Accreditation of the useful and constructed area of the dwelling;
– Age of the building and, where appropriate, of the main renovations or actions carried out on it;
– Services and facilities available in the home, both individual and common;
– Energy efficiency certificate;
– Accessibility conditions of the home and the building; and
– Status of occupancy or availability of the property.
- Legal information of the property: registry identification with reference to the charges, encumbrances and affections of any nature, and the participation fee set in the title deed.
- Any other information relevant to the interested party, including territorial, urban, physical-technical, heritage protection, or administrative aspects related to housing.
Bail/Bond
At the time of entering into the contract, the requirement and provision of a deposit is mandatory. One monthly payment.
The deposit must be provided by bank transfer. No other form of substitute guarantee, whether real or personal, is admitted, and in an amount equivalent to one month’s rent.
One of the provisions of the LAU that governs the contract imperatively:
– It is unwaivable for the lessor, who is in any case obliged to demand it; and
– The tenant cannot be required to pay more than one month’s rent as a deposit.
 Failure to comply with the obligation to demand or deposit the deposit may be punished by a fine for the lessor, who, in turn, may terminate the contract by operation of law for non-payment of the amount of the deposit or its updating.
Rent in Stressed Residential Market Areas
The new Housing Law 12/2023 seeks to guarantee access to housing by regulating rental prices in so-called “stressed” areas. These areas are identified if they meet at least one of the following criteria:
- High economic burden: If the cost of rent or mortgage, along with basic expenses (utilities such as electricity, water, telecommunications, etc.), exceeds 30% of the average household income in the area.
- Significant price increase: If purchase or rental prices have grown in the last five years by at least three percentage points above the CPI in the autonomous community.
Declaration of stressed areas by autonomous communities
It is the autonomous communities and the municipalities who have the power to request the Ministry of Housing to declare these areas. However, the implementation of this measure has had different responses depending on the region:
Communities that reject the measureÂ
- Andalusia: The Junta considers that this law invades its powers and has filed an appeal with the Constitutional Court.
- Aragon: The regional government does not intend to request the declaration of stressed areas.
- Cantabria: It has also ruled out implementing this measure in its territory.
- Castilla y LeĂłn: Governed by the PP, it has announced that it will not apply price restrictions.
- Castilla-La Mancha: Although the measure will not be applied, it is committed to the 10,000 homes Plan to promote access to housing.
- Balearic Islands: Despite the fact that towns such as Palma and SantanyĂ meet the criteria, the Balearic Government opposes it and has appealed the law for unconstitutionality.
Communities under evaluation or with partial implementationÂ
- Asturias: Some municipalities have shown interest in evaluating neighborhoods or councils (up to 13 of 78 municipalities could be declared stressed).
- Canary Islands: Towns such as La Orotava and Las Palmas de Gran Canaria have shown support for the measure, but most municipalities have not yet taken a clear position.
Communities that have adopted the measureÂ
- Catalonia: It is the most advanced community in price regulation. It has identified 140 towns as stressed areas, which affects 6% of the Catalan population. This includes 131 new municipalities awaiting approval from the Ministry of Housing.
How does this affect rents?
 In areas declared stressed:
- Rental prices will be controlled according to the benchmarks published by the Government.
- It seeks to protect tenants from disproportionate increases, although this could reduce the supply of rental housing.
This regulation generates debates about its effectiveness, as several autonomous communities argue that restrictions do not solve the problem of access to housing and may discourage owners from putting homes on the market.