Temporary Rental Versus Long-term Rental Contracts

If you’re out there in Barcelona looking for a property to rent you will have seen all the temporary rentals that are now offered on most flats and houses. Here I explain the difference between a temporary rental and a long-term rental.

Temporary versus the traditional long-term rental

Temporary rentals have been around for many years, but they have exploded recently mostly due to the tightening of rental laws for the traditional long-term rental contract, and in particular for the change of law last year (2023) which requires the property owner to pay the estate agency fee (honorarios).

Temporary rentals Barcelona

The different types of rental contracts

Holiday rentals are rentals for any period under 30 days – and they require a holiday rental licence from the city council.

Long-term rentals have a minimum required term for the tenant of six months, and owners are allowed to apply a penalty if the tenant leaves at any time up to 12 months. The long-term rental contract is valid for five years, and if the owner of the property is a company it’s valid for seven years. By law the owner should pay the estate agency fee, which is usually 10% of the annual rent plus VAT at 21%.

There are no specific laws for temporary rentals, and if problems should arise and a dispute goes to court, the long-term rental laws would be applied. The government recently set up a regulatory group to monitor the temporary rental situation, so maybe there will be changes or additions to the law for temporary rentals in the future.

Why are there now more temporary rentals than long-term rentals?

One reason owners are using a temporary rental contract is to avoid paying the agency fee – it’s the new tenant who has to pay this fee for a temporary rental. The minimum rental term is one month or three months (depending on the agency) and the maximum term is 11 months. After 11 months sometimes you have to vacate the property or sometimes you can negotiate another temporary rental contract. If you can stay put and sign another temporary contract, you may have to pay another agency fee. At the end of a rental contract the rent can increase too.

The rent for long-term contracts can only increase once a year in line with inflation. As inflation has been high over the last few years, the Government placed a cap of 2% on this increase in 2023, and 3% in 2024. So a temporary rental contract also allows the owners to keep up with the increasing market prices by being able to increase the rent more often.

Properties rented under a temporary rental contract are fully furnished and equipped, they often include bed linen too and internet is connected and included in the rent usually. The utilities are a set price per month, and calculated on how many people will be living in the property. If you overpay you’re refunded the balance, and if you use more utilities than is covered by the monthly price, you have to pay the difference at the end of the rental.

Long-term rental properties can be furnished or unfurnished. The furnished properties have the basic furniture included, but not the additional accessories such as lamps, bed linen, rugs, etc. Utility contracts have to be switched to the tenant’s name and paid directly by them to the utility companies.

It’s easier to rent a temporary rental property, as you don’t need an NIE or even a Spanish bank account. They can be a really good option if you’re newly arrived in the city and need somewhere to stay fast, whilst searching for long-term accommodation.

However, if you have a permanent employment contract often you won’t be allowed to rent a temporary rental as it can be written in the contract that it’s your second residence (even if it isn’t) and that it’s for a temporary stay. It can be a catch-22.

The benefits to you as a tenant are much better with a long-term rental contract. You can stay for up to five years, and sometimes up to seven years. The rent can only go up in line with inflation once a year. You do however, need an NIE, a Spanish bank account and proof of income – which is ideally a Spanish work contract.

So, there are pros and cons to both types of rental. If you plan to stay in Barcelona, or anywhere in Spain for that matter, for more than one year, it’s best to try to find a long-term rental. However, in Barcelona, that is becoming increasingly difficult.

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