Spain new rental law 2026: what the repeal means

October 7, 2026

Spain new rental law 2026: the essentials for landlords and tenants

The Spain new rental law 2026, Royal Decree-law 26/2026, was published on 30 September and repealed by Congress on 2 October 2026, so none of its measures applies [1][2].
An earlier decree with a 2% cap on rent updates, Royal Decree-law 8/2026, was repealed on 28 April 2026 [3].
The rules in force are the Urban Leases Law (LAU) and Law 12/2023 on the right to housing [4][5].
Annual rent updates are capped by the INE reference index (IRAV), which stood at 2.47% for August 2026 [6].
Rent controls apply only in declared stressed areas: 317 municipalities in five regions, none of them in the Valencian Community [7].
The general election of 29 November 2026 means any new housing law will come from the next parliament [8].

What happened to the Spain new rental law 2026

The Spain new rental law 2026 was a 96-page decree-law that the government approved on 29 September 2026 and published in the BOE the next day [1].

A decree-law takes effect at once but must be validated by Congress within 30 days, and on 2 October 2026 Congress voted to repeal it instead [2].

Three days later the Prime Minister dissolved parliament and called a general election for 29 November, with housing as the central issue [8].

This guide explains what the decree proposed, what applies now, and what landlords and tenants should do while the election is pending.

Royal Decree-law 26/2026 was published on 30 September 2026 and repealed by Congress on 2 October 2026 [1][2].

What the repealed decree would have changed

The decree touched almost every part of the rental market; these were the measures that mattered most to private landlords and tenants [1].

Area	What Royal Decree-law 26/2026 proposed	Position now
Seasonal rentals	A temporary letting only where the tenant is temporarily away from their usual home for a justified and provable reason, including room lettings	Not in force; the existing LAU rules apply
Tourist lets	Maximum stay of 31 days, set by the regional tourism authority	Not in force; regional rules apply
Extensions	Up to two extra years, at the tenant’s request, for contracts ending before 31 December 2028	Not in force
Annual rent updates	Capped at 2% without a new agreement until 31 December 2027, and frozen where rent exceeded the reference index	Not in force; the IRAV cap applies
Evictions	Suspension for vulnerable households without alternative housing until 31 December 2030, with compensation for some landlords	Not in force; Law 12/2023 procedures apply
VAT on short stays	From 1 December 2026, VAT on furnished lets of 30 nights or less, unless in the landlord’s own home	Not in force
Landlord income tax relief	A new scale of reductions from 100% down to 15%, depending on the rent agreed	Not in force; the 90% to 50% scale applies

Source: Royal Decree-law 26/2026 in the BOE [1].

The Spain new rental law 2026 also proposed limits on companies buying homes below 70% of their value and an extension of the 1.1% imputed income rate to 2026; both fell with it [1].

Why a decree-law can be repealed within days

Article 86 of the Spanish Constitution lets the government pass decree-laws in cases of extraordinary and urgent need, but Congress must vote to validate or repeal each one within 30 days of its promulgation [13].

Congress repealed the Spain new rental law 2026 in that vote on 2 October, and the repeal was published in the BOE the same day [2].

It was the second housing decree of the year to fall: Royal Decree-law 8/2026, approved in March in response to the war in Iran, included a two-year extension and a 2% cap on rent updates, and Congress repealed it on 28 April 2026 [3].

For landlords and tenants the practical lesson is the same in both cases: check whether a decree-law has been validated before relying on it.

After the repeal of the Spain new rental law 2026, the laws it would have amended apply in their previous wording.

The rules that apply to residential lettings now

With the decree repealed, residential lettings are governed by the Urban Leases Law (Law 29/1994) and Law 12/2023 on the right to housing [4][5].

Minimum term and extensions

Under Article 9 of the LAU, a residential tenancy runs for at least five years, or seven if the landlord is a company, through compulsory annual extensions at the tenant’s choice [4].

Our guide to the legal aspects of renting in Valencia explains notice periods and the landlord’s right to recover the home for family use.

Annual rent updates

Under Article 18 of the LAU, rent can be updated once a year only if the contract says so, and the increase cannot exceed the index set by the 11th additional provision [4].

That index is the INE’s reference index for rental updates (IRAV), which applies to contracts signed after 26 May 2023 [6].

The INE reference index that caps annual rent updates stood at 2.47% for August 2026, published on 15 September 2026 [6].

Stressed residential areas

Law 12/2023 lets regions declare stressed residential market areas, where rents on new contracts are contained and tenants can request extra extensions [5].

At the latest official list of 29 July 2026, 317 municipalities in Catalonia, the Basque Country, Navarre, Galicia and Asturias had been declared, covering 9.3 million people [7].

No municipality in the Valencian Community appears on that list, so these rent controls do not apply in Valencia, Alicante or Castellón.

317 municipalities in five regions are declared stressed residential areas, and none of them is in the Valencian Community [7].

Tenants’ protections under Law 12/2023, including the rules on evictions and large landlords, are set out in our guide to housing rights in Spain.

Landlords: tax relief and VAT under the current rules

Under Article 23.2 of the Personal Income Tax Law, net income from letting a home is reduced by 90%, 70%, 60% or 50%, depending on whether the property is in a stressed area, the rent was lowered, the tenant is young or the home was recently renovated [9].

The 50% reduction is the general case, and it is the one that applies to most landlords in the Valencian Community, where no stressed areas have been declared [7][9].

Furnished short lettings remain exempt from VAT unless the landlord provides hotel-type services such as cleaning, laundry or catering, as our guide to VAT on short-term tourist rentals explains [10].

Non-resident landlords pay non-resident income tax on their rent, as our guide to non-resident income tax in Spain explains.

Seasonal and tourist lets in the Valencian Community

Seasonal contracts remain governed by Article 3 of the LAU as it stood before the decree, so the stricter definition of the Spain new rental law 2026 does not apply [4].

A seasonal contract still needs a genuine temporary purpose, and a letting that is in fact the tenant’s permanent home is treated as a residential tenancy.

Holiday lets are governed by regional tourism rules, which in the Valencian Community require registration in the regional tourism register, among other conditions, as our guide to short-term rentals in Spain explains.

What landlords and tenants should do now

Until a new law is published, these steps reflect the position after the Spain new rental law 2026 was repealed.

Step	Action
1	Apply annual rent updates only if the contract provides for them, and within the IRAV
2	Ignore the 2% cap and the two-year extension: both measures were repealed
3	Check that every seasonal contract states its temporary purpose and keep evidence of it
4	If you signed or changed a contract on 1 or 2 October 2026, have it reviewed
5	Wait for a law published in the BOE before acting on election proposals

Common mistakes after the repeal

Assuming the 2% cap on rent updates still applies.
Relying on the two-year extension, which was repealed with the decree.
Applying stressed-area rules in Valencia, where none have been declared.
Charging VAT on 30-night lets from December on the strength of the repealed decree.
Using seasonal contracts for what are, in fact, permanent homes.

Landlords facing an occupied property should read our guide to squatters in Spain, which covers the procedures that differ from tenant evictions.

The election and the next Spain new rental law

When Congress was dissolved on 6 October 2026, all bills still before it lapsed under Article 207 of the Rules of the Congress [11].

Any replacement for the Spain new rental law 2026 will therefore have to come from the government formed after the election of 29 November.

Our guide to the Spain general election 2026 and foreign residents explains the timetable and what a caretaker government can do.

We will update this guide as soon as any new rule is published.

How Delaguía y Luzón can help

Our property law team in Valencia has advised landlords, tenants and investors since 1960.

We review leases and seasonal contracts, rent updates and tax relief under the Spain new rental law 2026 position, and act for clients in tenancy disputes.

Speak to our property team about your lease

Contact our legal team for personalised guidance on your case.

We work in English, French, Spanish and Russian from our office in Valencia.

Email: felix.delaguia@delaguialuzon.com
Phone: +34 963 74 16 57
Office: Avinguda Regne de València, 6, 1º-2º, 46005 Valencia

Frequently asked questions about the Spain new rental law 2026

Is the Spain new rental law 2026 in force?

No.

Congress repealed Royal Decree-law 26/2026 on 2 October 2026, so none of its measures applies.

Is there a 2% cap on rent increases?

No.

Both decrees that proposed it were repealed; the IRAV index caps annual updates instead.

How much can my landlord raise the rent this year?

Only if the contract allows an annual update, and by no more than the IRAV.

The IRAV was 2.47% for August 2026.

Can I ask for a two-year extension of my tenancy?

Not under the repealed decree.

The LAU extensions to five or seven years still apply, and extra extensions exist in stressed areas.

Are there rent controls in Valencia?

No.

No municipality in the Valencian Community has been declared a stressed residential area.

Do I have to charge VAT on short furnished lets from December?

No.

That change was part of the repealed decree; VAT applies only where hotel-type services are provided.

What happens to a contract signed while the decree was in force?

The decree was in force for a very short period.

If you signed or changed a contract on 1 or 2 October 2026, contact us to review it.

What tax relief do landlords get now?

Net rental income from a home is reduced by 90%, 70%, 60% or 50%.

Most landlords in the Valencian Community apply the 50% reduction.

Will the next government bring back these measures?

That depends on the result of the election of 29 November 2026.

Any new measure must be published in the BOE before it applies.

Where can I check whether my area is a stressed area?

The Ministry of Housing publishes the list of declared areas on its website.

The BOE also publishes each quarterly update.

References

Housing and Urban Planning