Housing Law Updates for 2023 (Rentals)

The recent enactment of Spain's Housing Law introduces several critical updates affecting both property owners and renters. Who pays the estate agent's fees?

A pivotal point addressed by this law is determining who is responsible for paying the fees charged by real estate agents during the property rental process. The Law 12/2023, dated May 24, clarifies that landlords are the ones obliged to pay these fees to the agency when it comes to the rental of their main residence for long-term agreements.

Specifically, Article 20.1 of the new legislation asserts that all expenses related to the management of the property and the formalization of the lease contract fall on the landlord's shoulders. Tenants, on the other hand, are still expected to cover their own security deposits and any additional guarantees that may be required upon entering a lease.

However, there are scenarios in which a tenant may incur real estate agent fees, such as:

  1. When leasing a property for transient use, not as a regular dwelling, which falls under Article 3 of the Urban Leases Act (LAU). This encompasses:

           a) Short-term holiday rentals, defined as those lasting no more than 31 days.

           b) Seasonal leases, which are more extended than vacation from 32 days, but stays do not surpass 11 months, used typically for temporary lodging during different seasons.

  1. Rental arrangements for executing various types of professional or business activities. This includes properties eased as commercial spaces, storage facilities, offices, or studios.

Additionally, for high-end residential leases that exceed either 300 square meters in size or a rental cost more than 5.5 times the national minimum wage, for example any property exceeding 6,000€ per month, the tenant may also be responsible for the agency's fees. In such cases, the LAU prioritizes the agreement between the landlord and tenant above its standard rules. If no specific contract terms exist, the LAU's provisions apply, followed by the Civil Code's supplementary guidelines where the LAU does not stipulate.