The government has approved two new housing decrees that change the rules for many rental agreements in Madrid and the rest of Spain. The measures include an extraordinary two-year extension for leases expiring before December 31, 2028; automatic renewal at the end of the minimum legal terms; and enhanced protection against certain rent increases, fees, and surcharges.
This new development may directly affect those whose leases are nearing expiration, especially tenants who feared having to negotiate a new rent in a market where prices are much higher than what they were paying when they signed. Even so, one key step remains: the two decree-laws must be ratified by Congress, for which the government has requested that an extraordinary plenary session be convened this Friday. It will also be necessary to consult the final text published in the Official State Gazette (BOE) to understand the exceptions, requirements, and specific implementation procedure.
The main measure: an additional two years on the lease
The first decree establishes a two-year extension for rental contracts for primary residences that expire before December 31, 2028. In practice, if your contract expires within that period, you’ll be able to keep it for two additional years under the conditions set forth in the new regulation.
This extension also covers leases that are already under tacit renewal—that is, those that have continued after the initial term or its legal extensions have expired without the parties having formalized a new lease. According to the Minister of Social Rights, Pablo Bustinduy, the measure could cover some five million people in Spain, including more than one million minors.
Automatic Renewal of Leases
The second decree approved by the government regulates the automatic renewal of lease agreements when the minimum lease terms expire . The Minister of Social Rights, Consumer Affairs, and the 2030 Agenda, Pablo Bustinduy, explained that once a five-year lease with a private landlord or a seven-year lease with a corporate landlord has been reached, the lease will be automatically renewed.
This measure represents a significant change for those who face uncertainty with each lease expiration. The automatic renewal is intended to ensure that the end of the minimum term does not force the tenant to renegotiate from scratch or leave the home simply because the landlord does not wish to continue under the same conditions.
However, renewal will not be entirely automatic in all cases.The government has indicated that there will be exceptions, including the proven need of the landlord or certain family members to reclaim the property. The specific wording of the decrees will define which circumstances are accepted, what notices are required, and how far in advance they must be provided.
Can the landlord raise the rent?
The approved package includes measures to limit certain rent increases. According to the Minister of Social Rights, leases with rents above the Ministry of Housing’s reference indices will have their annual adjustments frozen at 0%.
The exact scope of this measurewill need to be reviewed once the decree-law is published. In particular, it will be necessary to understand how a rent is determined to be above the index, to which leases it applies, whether it requires a declaration of a “high-demand area” or intervention by the autonomous community, and how the adjustment is calculated in each case
Commissions and surcharges are also changing
The decrees include“enhanced protection” for tenants against fees and surcharges deemed abusive. This measure supplements existing rules on real estate management fees and contract formalization costs, which—for primary residence leases—are the responsibility of the landlord when the landlord is a legal entity and, under the Law on the Right to Housing, also apply in other cases related to brokerage services.
The final text should clarify which fees and payments are specifically affected by the new regulation. For now, the recommendation for anyone about to sign or renew a lease is to request, in writing, a breakdown of any additional amounts: agency fees, contract fees, administrative fees, credit checks, insurance, utilities, homeowners’ association fees, security deposits, and additional guarantees.