Spain’s Housing Crisis: Long-Term Rentals Vanish, Seasonal Lets Up 55%

Discover how landlords are taking advantage of loopholes in Spain's housing market, leading to a surge in seasonal lets.

The latest data for the second quarter of 2024 reveals a significant decline in long-term rental real estate across Spain, with a notable decrease in the most sought-after cities. In crisis-stricken Barcelona, long-term rentals have dropped by a staggering 45%, while Madrid has seen a decrease of over 20%. Surprisingly, Malaga has experienced a 4% increase in long-term rental stock amidst ongoing protests.

Spain's Housing Crisis: Long-Term Rentals Vanish, Seasonal Lets Up 55%

The trend of diminishing long-term property rentals extends to other desirable locations in Spain as well. San Sebastian has witnessed a 32% decrease, Sevilla 27%, and Bilbo 22%. Alicante and Valencia have experienced more modest declines of 8% and 6% respectively. Landlords have been increasingly opting for seasonal lets, which have surged by 55% and now make up 13% of Spain's total rental stock. Barcelona leads the way with a 42% increase in seasonal contracts, followed by San Sebastián at 34%.

Various cities, including Badajoz, Girona, Cádiz, Madrid, and Valencia, have significant seasonal rental markets, with 21 provincial capitals doubling their seasonal rental offerings over the past year. Seasonal lets, characterized by housing set for a specific period, have been exempted from the 2023 Housing Law, allowing landlords to avoid restrictions on rent hikes, contract extensions, and rent controls in 'stressed areas'.

In response to the growing issue of short-term property rentals, Madrid is considering new regulations to curb abuses in the market. Landlords may soon be required to justify limiting contracts to prioritize short-term property rentals for seasonal workers and students. Additionally, a new government platform is being developed for registered landlords to advertise short-term rentals, with each rental assigned a unique code for tracking and control purposes. These measures, aligned with recent EU legislation, are expected to be implemented by the end of 2025 following discussions with Spain's working group on short-term rentals.

The rental real estate market in Spain is undergoing significant shifts, with landlords increasingly favoring seasonal lets over long-term rentals. Policy makers are taking steps to address issues related to short-term property rentals and ensure fair access to housing for those in need.