Landlords in Spain are set to face a new rule: if they end a rental contract without a valid reason, they must pay tenants at least twelve months’ rent. The measure is part of a government decree expected to appear in the BOE. It introduces automatic contract renewals and compensation for owners who end agreements without cause. El Diario and ARA report that the payout is tied to the official rental price index and cannot be less than one month’s rent for every year the tenant has lived in the home.
The basic change is to Article 10 of the Ley de Arrendamientos Urbanos (LAU). Contracts will renew automatically for the same length after the first mandatory period: five years for individuals and seven for companies. Either side can end the agreement, but notice is required: landlords must give six months’ notice, while tenants need to give only two. The arrangement aims to give tenants more stability and reduce sudden evictions. Heraldo and other national outlets have covered these details.
If a landlord wants to end a contract, they no longer need a specific reason, but they must pay at least twelve months’ rent, based on the state’s official rental price index. The amount cannot be less than one month’s rent for every year the tenant has lived in the home. Exceptions apply. Landlords do not have to pay if they need the property for themselves or a close family member. No payout is required if the tenant has not lived in the home for more than six months without a good reason or owns another suitable home in the same town. Signing a new regulated contract also removes the payout requirement. Landlords who can prove they are vulnerable are exempt, too. The draft spells out these points, which ARA and other independent summaries have also reported.
The government split the housing reform into two decrees. The first lets tenants request a two-year extension. El Diario reports that the extraordinary extension for expiring rental contracts, available to tenants who have paid regularly, will remain in force until December 31, 2028. The second decree, now in the spotlight, introduces automatic renewal and the compensation rule. Officials say the sequence is needed for legal clarity: the second decree changes parts of the first, which has not yet been published. Congress will vote on the texts separately in a special session on Friday. The government is counting on public support for tenant rights to pressure coalition partners who remain unsure. Minister Pablo Bustinduy says this approach will make the reforms stronger and legally clear.
Tenant groups, especially the Sindicato de Inquilinas, oppose the split. They say it could lead to the automatic renewal rule being blocked, weakening the push for contracts that let tenants stay as long as they meet their obligations and there is no justified reason for eviction. The debate intensified after Maricarmen’s eviction by Urgabestión. The case made national news and was previously covered here.
ARA describes the new mechanism as bringing some rental contracts closer to indefinite or open-ended status, with exceptions where landlords or close relatives need the property. The reform is presented as a way to strengthen rental stability and forms part of a broader package of urgent housing measures being debated amid a tense rental market.
Talks within the government have been tense. Left-wing parties back the tenant movement’s demands, while PSOE is trying to balance them with the wishes of basic allies such as PNV and Junts. Officials say the delay in publishing the decree is only technical. The outcome will determine whether Spain’s rental market shifts toward long-term tenant security or remains caught in cycles of renegotiation and uncertainty.
If passed as written, the reform would be one of the biggest changes to Spanish rental law in years. Landlords would pay a price for ending contracts without cause as the government seeks greater stability for tenants and a shift in the balance of power. Its impact will depend on the final parliamentary vote and whether all sides follow the new rules.
