Spain rental shock: What Congress rejecting two housing decrees means for tenants and landlords

Renters and landlords need to know what happens next after MPs vote down the Government’s latest housing measures.

Spain’s latest attempt to change the rules for rented homes has been rejected by Congress, leaving renters and landlords facing a return to the previous system.

Two separate housing decrees were put to MPs, covering everything from rent increases and contract extensions to what happens when a landlord wants to end a long-running tenancy. Both have been defeated. For people who do not follow Spanish politics closely, here is what the vote means for your home.

If you rent your home

You do not get the new automatic two-year extension. One of the most important measures in the first decree would have allowed qualifying tenants to request up to two additional years when their existing rental contract reached the relevant expiry date. That applied to certain contracts already in force when the decree came into effect, provided the tenant was up to date with the rent and met the other conditions.

With the decree rejected, that new protection does not become part of the permanent rental rules. You also lose the new 2 per cent rent-rise protection. RDL 26/2026 would have limited annual rent increases on qualifying existing contracts to 2 per cent where no new agreement was reached, with no increase in certain cases where the existing rent was above the applicable reference-price ceiling. That measure also falls with the decree, so existing rental rules return to the picture.

For many ordinary residential contracts, that means the familiar system under Spain’s Rental Housing Law, including annual tacit extensions for up to three years once the initial minimum period has ended.

What about landlords?

The second decree would have represented the biggest change for owners of long-term rental properties. Under that measure, once a tenancy had passed its minimum five-year period — or seven years where the landlord was a company — the contract would have continued in successive five-year periods for an individual landlord, or seven-year periods for a company, unless notice was given. Landlords would also have had to give six months’ notice if they wanted to end the tenancy and, in many circumstances, pay the tenant compensation equivalent to at least 12 months’ rent.

That system will not now take effect as a permanent change. Instead, the existing rules still apply.

What if you own a property?

For homeowners who do not rent their property, much of the immediate impact is limited. RDL 26/2026 contained a much wider package covering property purchases, taxation, public housing and measures intended to increase the supply of affordable homes. Those measures also fell when the decree is not convalidated. Landlords should therefore not assume that the tax changes or incentives contained in the package have become permanent either.

Could the housing measures return?

The Government has indicated that it intends to pursue further housing measures through other legislation. Any new package would need parliamentary approval, so tenants and landlords should follow the rules currently applicable to their contract rather than assume the rejected measures will return.

The vote has also increased political pressure on Pedro Sánchez. Read our separate report on whether Spain could face an early general election.

That removes the detailed party arguments, Madrid protests, Zapatero comparison and election speculation, keeping this article focused on rental rules.