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Spain’s New Housing Decrees: Rentals Are Falling

Spain's New Housing Decrees: Rentals Are Falling, but What Actually Applies Today?

Spain’s estate agents say the long-term rental market is already shrinking, just days after the government reissued its housing decrees in October 2026. Many landlords are pausing, selling or switching to seasonal lets.

But much of the coverage blurs a key point. There are two separate decrees, they apply on different dates, and the best-known measure is not in force yet. Here is what has actually changed, what hasn’t, and what landlords and tenants should do now.

What estate agents are reporting

Nearly 9 in 10 agencies say they have seen disruption since the new decrees were announced. The figures come from a survey by Spain’s National Federation of Real Estate Associations (FAI) of around 600 agencies in major cities.

Finding	Share of agencies
Report some market disruption	88.9%
Say small landlords are most put off	78.1%
Have contract signings suspended or postponed	72.4%
See rental homes being put up for sale instead	about 56%
See landlords moving to seasonal or room rentals	38.9%

The FAI estimates that around 4,235 homes left the long-term rental market in ten days, and warns activity could fall by 25 to 30% in the coming weeks.

A word of caution: this is an industry survey, from a body that represents estate agents, and it covers major cities rather than the Costa Blanca specifically. It is a useful early signal, not official data.

Two decrees, two timelines

On 6 October 2026 the government approved two new royal decree-laws, replacing the versions Congress rejected days earlier. They do not apply on the same date.

Decree	What it covers	Applies from
RDL 29/2026	Wider housing package, including rules for seasonal and room rentals and an extraordinary extension of certain main-residence leases	8 October 2026 (already in force)
RDL 28/2026	Automatic renewals and compensation when a landlord does not renew	15 November 2026, if not repealed first

What RDL 28/2026 would change

Once a main-residence lease has run its minimum five years (seven if the landlord is a company), it would renew automatically for further five-year (or seven-year) periods. A landlord who wants to end it would need to give six months’ notice instead of four. Tenants keep a two-month notice period.

A landlord who validly chooses not to renew would owe the tenant compensation, paid when the keys are handed back. Under the official text, it is the higher of:

twelve months’ rent, calculated on the upper value of the state rental reference index for that property; or
one month’s rent for each year the tenant has lived there.

If no reference value exists for the property, the contract’s current rent is used instead. So this is not simply “one year’s rent”: it is based on an official reference figure, which may be higher than what the tenant actually pays.

No compensation is due in certain listed cases, which must be stated in writing in the notice. These include the landlord (as an individual) needing the home for themselves or close family, the tenant not living there for more than six of the previous twelve months, the tenant having another suitable home in the same town, or the tenant turning down a qualifying offer of a new contract.

Non-renewal notices validly sent before the decree was published on 7 October 2026 remain valid and do not trigger compensation.

Who decides, and when ?

With parliament dissolved ahead of the general election on 29 November, both decrees go to the Diputación Permanente, the standing committee of Congress. Under articles 78.2 and 86.2 of the Spanish Constitution, it must validate or repeal each decree within 30 days of its enactment, which means early November.

That deadline falls before 15 November. In practice, the renewal and compensation rules will only ever apply if the committee validates RDL 28/2026 first.

If a decree is repealed, it stops applying from that point on. As a general rule, legal effects produced while it was in force are not undone. That matters for RDL 29/2026, which is already in force now.

What this means for you

If you rent out a property in Spain, don’t make a hurried decision based on headlines. Before sending a non-renewal notice, switching to a seasonal let or selling, check which rules already apply to your contract, when it expires, and what notice and compensation would apply if RDL 28/2026 is validated. Seasonal lets are also covered by the rules already in force, so switching is not a way around regulation.

If you are a tenant, especially one whose contract ends in the coming months, check whether you qualify for any extension already available, and keep your contract and correspondence in order. Whether automatic renewals and compensation arrive depends on a vote in early November.

In both cases, the details of your contract matter more than the headlines.

Need advice on your rental?

SGM Abogados advises landlords and tenants across the Costa Blanca, from our offices in Benijófar and San Javier. Contact us at info@sgmlegalspain.com to check how these changes affect your contract.