The landscape of rental housing and legal proceedings in Spain has taken a 180-degree turn. The passage of the Royal Decree-Law No. 26/2026, dated September 29, introduces far-reaching structural changes to the Urban Lease Law (LAU) and the Civil Procedure Law (LEC).
Below, we provide a practical and detailed breakdown of how these changes affect property owners, tenants, and legal professionals, organized by topic.
Block 1: The Crackdown on Fraud in Short-Term and Room Rentals
One of the main goals of the reform is to curb the shift of residential housing toward seasonal rentals or room rentals in order to circumvent the price caps set by the 2023 Housing Act. The Royal Decree-Law 26/2026, Art. 3 amends Article 4.2 of the LAU to subject these arrangements to much stricter oversight.
1. Room Rentals Are Covered by the LAU
- Classification by use: The partial rental of a dwelling (rooms or living spaces) is legally classified according to the need it fulfills. If the room meets the tenant’s need for permanent housing, it will be governed as a lease for a primary residence (with all its extensions and rights). If it is due to a justified relocation, it will be considered a temporary lease.
- Cumulative price limit: The total rent from all room rental agreements in effect at the same time for a single dwelling may not exceed the unit rental price for the entire dwelling.
- High-Demand Areas: In areas designated as high-demand residential markets, both the unit price and the total price of all room contracts must strictly adhere to the maximum price limits established by law.
2. New Rules and Penalties for Short-Term Rentals
- Express and substantiated reason: For a lease to be considered “temporary,” the tenant must be away from their usual residence for a real, justified, and substantiable reason (education, temporary work, etc.). The reason must be expressly stated in the lease, and the landlord bears the burden of proving its veracity.
- Automatic Conversion to Primary Residence: If the lease lacks an express purpose, if such purpose cannot be proven, if its term exceeds 12 months without justification, or if there are more than two consecutive temporary leases between the same parties for the same residence, the lease will automatically be converted into a primary residence lease from the outset, granting the tenant the right to remain in the property for up to 5 years (or 7 if the landlord is a legal entity).
- Price cap on successive leases: If several successive temporary leases are entered into for the same dwelling, the rent under the new leases may not exceed the annual percentage increase set by the Reference Index for the Annual Adjustment of Residential Leases (IRAV).
Section 2: New Tenant Rights and Landlord Obligations
The reform rebalances the contractual obligations under the LAU, limiting pass-through expenses and strengthening guarantees of habitability.
- Prohibición absoluta de repercutir gastos de gestión: The landlord may not charge the tenant, under any circumstances or by any name, for real estate management fees or fees related to the execution, preparation, or renewal of the lease.
- Prohibition on Passing On Taxes: It is not permitted to agree that the tenant will pay taxes associated with the property (such as the Property Tax—IBI), unless the tenant is the taxpayer required by law.
- Strict limit on additional guarantees: In leases for primary residences, additional guarantees beyond the cash security deposit may not exceed two months’ rent (and one month’s rent in the case of temporary leases). Furthermore, it is expressly prohibited to require the tenant to purchase rent default insurance.
- Right to Self-Repair in Case of Damage: Royal Decree-Law 26/2026 (Art. 3.13) introduces paragraph 5 to Article 21 of the LAU. If there is damage that affects the livability, safety, or health conditions of the dwelling, the tenant may request repairs in writing, attaching a cost estimate. If the landlord fails to respond or unjustifiably refuses within 15 calendar days, the tenant may carry out the repairs and deduct the cost directly from future rent payments.
- Expansion of the right of first refusal: In the case of joint sales of buildings, the tenant’s right of first refusal is preserved if the tenant’s dwelling is legally identifiable as a separate unit, and any contractual waiver of this right is expressly prohibited.
Section 3: Special Extensions for Existing Contracts
A significant change for lease agreements entered into prior to the 2023 Housing Act is the one introduced by Royal Decree-Law 26/2026 (Art. 4.2), which amends the fourth transitional provision of Law 12/2023:
- Application of Extensions: Lease agreements subject to the 1994 LAU that were entered into before the 2023 Housing Act took effect will be eligible for the extraordinary extensions provided for in Article 10 of the LAU (current version).
- Rent Increase Limit: Rent increases will be subject to the applicable maximum limit in accordance with the eleventh additional provision of the LAU. In all other respects, they will remain subject to the legal regime in effect at the time the lease was entered into.
Block 4: Revolution in Judicial Proceedings and Evictions
The civil procedure system is undergoing a radical transformation with the goal of preventing any vulnerable person from being evicted from their home without a decent alternative place to live.
1. Suspension of Evictions Through 2030 (Article 2)
Royal Decree-Law 26/2026 — Art. 2 establishes a temporary eviction moratorium in effect until December 31, 2030:
- Against “Vulture Funds” (Art. 2.1): If the plaintiff is an entity engaged in the acquisition of portfolios of delinquent loans or real estate below market value to maximize profits, and the defendant is in a vulnerable situation with no alternative housing, the court shall mandatorily stay the proceedings by order. This suspension does not entail financial compensation for the plaintiff.
- Frente a otros propietarios (Art. 2.2): Si el demandante no es un fondo de inversión, el tribunal suspenderá el proceso y requerirá a la Administración autonómica para que ofrezca una alternativa habitacional. Si no se dispone de ella, el proceso se suspenderá hasta que se garantice.
- Compensation: In this case, the competent authority will cover the costs of compensating the owner (whether an individual or a legal entity engaged in affordable rental housing), paying up to the amount of the contractual rent that was not received and any unpaid utility bills.
- Review: The suspension will be reviewed every 12 months and lifted if the vulnerability is resolved, if an alternative is rejected without just cause, or if 3 years have elapsed.
- Exception for Vulnerable Property Owners: The suspension will not apply if the property owner is an individual in a vulnerable situation who owns two or fewer homes.
2. Extraordinary Structural Innervation (Article 5.2)
A new procedural provision is being introduced into the Civil Procedure Act (LEC) that requires public authorities to provide financial assistance to prevent eviction:
- Regional Payment Obligation: In eviction proceedings due to nonpayment of rent where the tenant is vulnerable and is not offered alternative housing, the autonomous communities shall be required to stay the proceedings within two months by paying or depositing the amounts owed with the court. The legal proceedings shall remain suspended during those two months.
- Mandatory Subrogation: If the Autonomous Community does not dismiss the lawsuit or offer an alternative within two months, the government will automatically be subrogated into the tenant’s position as debtor. The eviction proceedings will be terminated, there will be no eviction, and the lease agreement will remain in effect as usual.
- State compensation: The State will compensate the Autonomous Communities for the cost of these disruptions (except for late payment interest resulting from delays on the part of the regional administration itself).
Transition Provisions for Existing Contracts
To provide legal certainty to the market, Royal Decree-Law 26/2026 (Art. 3.22) introduces the eighth transitional provision into the LAU:
- Previous Contracts: Seasonal or room rental contracts entered into before October 1, 2026 will continue to be governed by the previous legal framework until the end of the agreed-upon term, at which point they will terminate without the possibility of extension.
- Renewals: Any renewal or new fixed-term contract signed after the decree-law takes effect will be fully subject to the reform’s new and strict requirements.
