The vote this Thursday in the Standing Committee of the Congress leaves two different outcomes for the rental market. Tenants may continue to request an extraordinary extension of up to two years in certain contracts and the limit on annual rent updates remains in place, while the automatic renewal of leases and the obligation to compensate the tenant when the landlord decided not to renew them have been ruled out.
The first housing decree has been approved by a single vote, with the support of PSOE, Sumar, ERC, PNV and Podemos. PP, Vox and Junts voted against it. The second rule, promoted by Sumar, was repealed after the PNV joined the rejection of those three parties.
Second Deputy Prime Minister Yolanda Díaz has celebrated the ratification and assured that "five million people will be able to extend their rentals and save 4,300 euros a year". These are estimates defended by the minister, not savings guaranteed for all contracts.
What happens now if I live on rent? Can my landlord raise the rent? And if I am a homeowner and want to get the home back? The answer depends on when the contract was signed, when it ends, whether the tenant is up to date with payments, and what conditions apply in each case.
If I am a tenant, can I extend my rent for two more years?
Yes, if the contract meets the requirements of the ratified decree. The rule allows requesting an extraordinary extension in annual periods, up to a maximum of two additional years, during which the contract conditions remain in force.
To take advantage of it, the rent must correspond to a habitual residence and be subject to the Urban Leases Act. In addition, it must be a contract that was in force when the decree came into effect and fall under one of the termination cases of the mandatory extension, the implied extension, or the implied renewal extension cases contemplated in the fifth final provision.
In particular, the rule includes contracts whose mandatory extension ends before December 31, 2028. The tenant must be up to date with the rent and have paid monthly during the eight months prior.
The extension is not granted automatically. It is necessary to request it from the landlord, who must accept it except in the legally provided exceptions.
For example, if a contract meets the requirements and ends in June 2027, its holder may request a first extraordinary annual payment and, subsequently, another one, until completing the two additional years.
Do I have to request the extension, or does it renew automatically?
It must be requested. This is one of the main differences between the two decrees voted on this Thursday.
The regulation that remains in force recognizes the right to request an extraordinary extension, but does not establish the general automatic renewal that the text promoted by Sumar intended to introduce.
To avoid conflicts, it is advisable to communicate the request in writing and keep proof of its receipt. It is advisable to identify the contract, the expiry date, and the legal provision on which the request is based.
The decree does not establish a single form for all leases. Nor should this extraordinary extension be confused with the ordinary extensions provided for in the Urban Leases Act, which have their own deadlines and requirements.
Can my landlord raise my rent in 2027?
The validated regulation introduces an extraordinary limit on annual rent updates until December 31, 2027.
If the rent exceeds the maximum limit applicable under the reference price index system, no increase may be applied in the annual update.
In other cases, landlord and tenant may negotiate the update. If they do not reach a new agreement, the increase may not exceed 2%.
For example, for a rent of 900 euros per month that does not exceed the reference limit and for which an update applies, the maximum increase without a new agreement would be 18 euros per month. The rent would go to 918 euros.
On the other hand, if that rent already exceeds the maximum applicable under the reference system, the update would be blocked.
The 2% limit is not an authorization to automatically raise all rents. The update must be provided for in the contract and comply with legal requirements.
If I am the owner, am I required to accept the two additional years?
As a general rule, yes, when the tenant meets the conditions for the extraordinary extension. The decree expressly establishes that the lessor must accept the request, although it contemplates several exceptions.
The extension may not apply if both parties agree on other conditions or sign a new contract. There are also exceptions when the landlord proves a real need to recover the home for themselves or for certain family members, with the requirements and communications required by the Urban Leases Law.
The rule also allows the parties to agree on a renewal or a new contract with a rent at least 5% lower than the previous one, in which case the extraordinary extension regulated in that provision does not apply.
Therefore, the landlord cannot freely refuse a request that meets the requirements, but neither is it obliged to accept the extension in all imaginable cases.
If I need to recover my home, can I do it?
Yes, when the legal circumstances that allow the property to be recovered due to need are met.
The decree provides for the possibility that the landlord communicates their intention to occupy the home for themselves or for the family members provided for in the Urban Leases Law, provided that there is a real and proven need and that the conditions and communication deadlines applicable are respected.
Recovery cannot be justified only by means of a generic statement. If a conflict arises, it will be necessary to examine the specific circumstances and the documentation available.
It should also be taken into account that the rule provides for specific regulation for this extraordinary extension, so it is not enough to mechanically apply the usual contract termination rules.
Do I have to compensate the tenant if I don’t renew the contract?
No, for the general compensation of twelve monthly payments that the rejected decree proposed this Thursday.
The rule promoted by Sumar aimed to oblige the landlord to compensate the tenant when they decided not to renew the contract, with certain exceptions. The amount would be calculated by reference to twelve monthly payments for a home with similar characteristics.
This measure has not passed the vote of the Permanent Deputation and therefore will not enter into force according to the scheduled calendar.
This does not eliminate the compensation that may correspond for other contractual or legal breaches. It simply means that the new general compensation for not renewing the rent has not been approved.
The extension of the landlord’s notice period to six months that was included in that second decree has also been ruled out. The deadlines provided for in the applicable legislation for each contract remain in place.
What happens if my tenant stops paying?
The ratification of the decree does not eliminate the obligation to pay rent.
In fact, in order to access the extraordinary extension of up to two years, the tenant must be up to date with their obligations and have paid the monthly payments for the eight months prior.
In eviction matters, the rule incorporates specific protections for vulnerable people without an alternative housing option until December 31, 2030.
This is not a general prohibition of all evictions. The suspension depends on the situation of the occupant, the existence of alternative housing, and the circumstances of the landlord.
When the claimant is a natural person or an entity dedicated to affordable rental housing, the decree provides for compensations at the expense of the Administration in certain cases, which may include rent amounts not received, unpaid utilities, and procedural costs within the legal limits.
In addition, the suspension does not apply in certain cases when the landlord demonstrates that they are also in a situation of vulnerability and has two or fewer homes.
What happens if my contract ends in 2028?
The date is important, but not enough to know whether the extension applies.
The fifth final provision includes the contracts in force at the time the decree enters into effect whose mandatory extension ends before December 31, 2028, in addition to other cases of termination of the extensions provided for in the rule.
Not all contracts expiring in 2028 automatically have the right to two additional years. It is necessary to check what stage the lease is in, when it was signed, and whether the required conditions are met.
Anyone with a contract close to its expiration date should review both their initial date and any extensions that have already taken place.
What other housing measures remain in force?
The ratified decree includes changes that go beyond the duration of rentals.
Among them is stricter regulation of seasonal and room-by-room contracts, with measures aimed at preventing them from being used to evade the guarantees of a standard rental lease.
It also incorporates a state deduction in the IRPF of 10% of the amounts paid for the rental of the primary residence for taxpayers with income below 33,007.20 euros per year, in the terms provided for in the regulation.
For certain landlords who do not have the status of large holders, tax incentives linked to the reduction of rents are contemplated, which may reach 100% in the cases established by law.
In terms of purchase, the decree includes the financing mechanism 'Tu Casa', managed by the Instituto de Crédito Oficial (ICO), with loans of up to 50,000 euros to facilitate the acquisition of the first primary residence.
What the Congress has approved and what it has rejected
| Measure | Result |
|---|---|
| Extraordinary extension of the rental for up to two years, upon request and with requirements | Validated |
| Extraordinary limit on the annual updating of the rent until the end of 2027 | Validated |
| Protection against certain evictions of vulnerable people until 2030 | Validated |
| General automatic renewal of rental contracts | Rejected |
| General compensation to the tenant for the landlord’s decision not to renew | Rejected |
| Extension of the landlord’s notice period to six months | Rejected |
The vote thus leaves additional protection for certain primary residence housing contracts, but without the general automatic renewal or the compensation that Sumar defended.
For tenants, the decisive issue will be checking whether they can apply for the extension and under what conditions their rent will be updated. For landlords, when they are required to accept it and what exceptions allow them to regain the home.