Authored by the expert who managed and guided the team behind the Spain Property Pack
Everything you need to know before buying real estate is included in our Spain Property Pack
Spain remains one of Europe's most attractive markets for foreign landlords in 2026, but the rules are tightening and understanding them is now essential for success.
This guide covers everything you need to know about renting out a property in Spain as a foreigner, from legal requirements to realistic yields and the best neighborhoods for rental income.
We update this blog post regularly to reflect the latest regulatory changes, market data, and rental trends across the country.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Spain.
Insights
- Spain's rental supply has dropped by roughly 50% over the past five years while advertised rents have climbed over 30%, creating intense competition for long-term tenants in cities like Madrid and Barcelona.
- The IRAV index now caps annual rent increases for many contracts at around 2.2% in Spain as of early 2026, replacing the old CPI-linked system and limiting landlord flexibility in high-demand areas.
- Barcelona plans to phase out all 10,000 short-term rental licenses by November 2028, meaning Airbnb-style investing there is effectively a sunset strategy for anyone entering now.
- Valencia offers one of Spain's best combinations of affordability and yield in 2026, with gross rental returns often reaching 6% to 7% in neighborhoods like Ruzafa and El Carmen.
- Non-resident landlords in Spain face a flat 19% tax on net rental income if they live in the EU or EEA, but the rate jumps to 24% for landlords from other countries like the US or UK.
- Spain fined Airbnb 65 million euros in late 2025 for listing over 65,000 unlicensed properties, signaling that enforcement of short-term rental rules is now aggressive and real.
- Madrid has frozen new short-term rental licenses until 2026, pushing many investors toward long-term leases where vacancy rates in the city center sit around just 2% to 3%.
- Over 630,000 rental contracts signed in 2021 are set to expire in 2026, potentially adding pressure to renewal negotiations and creating turnover opportunities for landlords.
Can I legally rent out a property in Spain as a foreigner right now?
Can a foreigner own-and-rent a residential property in Spain in 2026?
As of early 2026, foreigners can legally own residential property in Spain and rent it out, whether on a long-term lease or as a short-term tourist rental, without needing Spanish residency or citizenship.
Most foreign landlords in Spain hold property directly in their personal name using an NIE (foreigner identification number), though some investors use a Spanish limited company (SL) for tax planning or liability reasons.
The biggest restriction foreigners face in Spain in 2026 is not on ownership itself but on short-term rentals, where regional licenses, building community approval, and new national registration requirements can block or severely limit tourist rental activity.
If you're not a local, you might want to read our guide to foreign property ownership in Spain.
Do I need residency to rent out in Spain right now?
No, you do not need to be a Spanish resident to rent out property in Spain, and many foreign landlords manage their rentals entirely from abroad while meeting local tax and registration obligations.
You will need a Spanish tax identification number (NIE) to legally own property, sign contracts, and file the required non-resident income tax returns in Spain.
A Spanish bank account is not strictly mandatory, but it is strongly recommended because most tenants, property managers, and utility companies prefer Spanish IBAN payments for rent and bills.
Managing a rental in Spain remotely is entirely feasible in 2026, especially if you hire a local property manager or gestor to handle tenant relations, tax filings, and compliance paperwork on your behalf.
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What rental strategy makes the most money in Spain in 2026?
Is long-term renting more profitable than short-term in Spain in 2026?
As of early 2026, long-term renting in Spain offers more predictable returns with lower management effort, while short-term rentals can generate higher gross income but carry significantly more regulatory risk and operational burden.
A well-managed long-term rental in a Spanish city might earn 8,000 to 14,000 euros (roughly 8,600 to 15,100 USD) per year net, while a well-performing short-term rental in the same location could gross 15,000 to 25,000 euros, but after cleaning, management, vacancy, and compliance costs the net difference often narrows considerably.
Short-term rentals tend to outperform financially in high-tourism areas like coastal Malaga, the Balearic Islands, or central Barcelona (where licenses exist), while long-term leases work better in job-driven cities like Madrid or Valencia where stable tenant demand dominates.
What's the average gross rental yield in Spain in 2026?
As of early 2026, the average gross rental yield for residential properties in Spain is around 5.5% to 6% per year, though this varies widely depending on city, neighborhood, and property type.
Realistic gross yields in Spain range from about 4% in expensive prime areas like Barcelona's Eixample or Madrid's Salamanca, up to 8% or more in affordable secondary cities like Almeria, Murcia, or outer districts of Valencia.
Studios and small one-bedroom apartments in Spain typically achieve the highest gross rental yields because their lower purchase prices attract strong demand from students, young professionals, and single renters who fill them quickly.
By the way, we have much more granular data about rental yields in our property pack about Spain.
What's the realistic net rental yield after costs in Spain in 2026?
As of early 2026, the average net rental yield after all costs for residential properties in Spain is around 3.5% to 4% per year, assuming typical expenses and no mortgage.
Most landlords in Spain realistically experience net yields between 2.5% in premium city centers and up to 5% in high-yield secondary markets once all recurring costs are deducted.
The three main cost categories that eat into gross yield in Spain are property tax (IBI) which varies significantly by municipality, community fees (gastos de comunidad) that can be substantial in buildings with elevators and pools, and the non-resident income tax that ranges from 19% to 24% depending on the landlord's home country.
You might want to check our latest analysis about gross and net rental yields in Spain.
What monthly rent can I get in Spain in 2026?
As of early 2026, typical monthly rents in Spain average around 515 euros (555 USD) for a studio, 810 euros (875 USD) for a one-bedroom apartment, and 1,175 euros (1,270 USD) for a two-bedroom apartment at the national level.
A decent studio apartment in Spain can realistically rent for 400 to 650 euros (430 to 700 USD) per month depending on the city and neighborhood, with Madrid and Barcelona commanding the upper end.
A typical one-bedroom apartment in Spain rents for 650 to 1,000 euros (700 to 1,080 USD) per month in most major cities, though premium locations in Madrid's Salamanca or Barcelona's Eixample can push well above 1,200 euros.
A standard two-bedroom apartment in Spain commands 900 to 1,500 euros (970 to 1,620 USD) per month, with family-friendly neighborhoods in Valencia or Malaga at the lower end and central Madrid or Barcelona significantly higher.
If you want to know more about this topic, you can read our guide about rents and rental incomes in Spain.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Spain versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
What are the real numbers I should budget for renting out in Spain in 2026?
What's the total "all-in" monthly cost to hold a rental in Spain in 2026?
As of early 2026, the total "all-in" monthly cost to hold and maintain a typical rental apartment in Spain is around 300 to 450 euros (325 to 485 USD), excluding mortgage payments.
Realistic monthly holding costs in Spain range from 200 euros for a simple apartment in a smaller city to 600 euros or more for a larger property in a premium building with a pool, doorman, and high community fees.
Community fees (gastos de comunidad) are usually the largest single cost category in Spain, often running 50 to 150 euros per month, especially in buildings with elevators, gardens, or shared amenities that require ongoing maintenance.
You want to go into more details? Check our list of property taxes and fees you have to pay when buying a property in Spain.
What's the typical vacancy rate in Spain in 2026?
As of early 2026, the typical vacancy rate for long-term rental properties in Spain is around 4% to 5% nationally, meaning landlords should expect roughly two to three weeks of vacancy per year on average.
In high-demand city centers like Madrid or Barcelona, vacancy rates drop to just 2% to 3%, so landlords there might budget for only one to two weeks of vacancy per year because well-priced apartments rent within days.
The main factor affecting vacancy rates across Spanish neighborhoods is proximity to jobs, universities, and metro stations, as properties near these hubs fill faster while isolated or poorly connected locations sit empty longer.
Summer months (July and August) typically see the highest tenant turnover in Spain because many leases end in June, students leave for holidays, and families try to move before the new school year begins in September.
We have a whole part covering the best rental strategies in our pack about buying a property in Spain.
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Where do rentals perform best in Spain in 2026?
Which neighborhoods have the highest long-term demand in Spain in 2026?
As of early 2026, the three neighborhoods with the highest overall long-term rental demand in Spain are Madrid's Chamberí, Barcelona's Eixample, and Valencia's Ruzafa, all offering excellent transit, walkability, and a deep pool of professionals seeking quality apartments.
For families looking to rent in Spain, the strongest demand concentrates in Madrid's Chamartín and Retiro, Barcelona's Sarrià-Sant Gervasi, and Valencia's Pla del Real, where international schools, parks, and family-friendly amenities cluster.
Students drive intense rental demand in Madrid's Moncloa-Aravaca (near Ciudad Universitaria), Barcelona's Gràcia (close to UPF and other campuses), and Valencia's Benimaclet (adjacent to Universitat Politècnica), making these areas ideal for landlords targeting that tenant segment.
Expats and international professionals concentrate in Madrid's Salamanca, Barcelona's Poblenou, and Malaga's Centro and Soho, all neighborhoods known for English-friendly services, coworking spaces, and a cosmopolitan lifestyle.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Spain.
Which neighborhoods have the best yield in Spain in 2026?
As of early 2026, the three neighborhoods offering the best rental yields in Spain are Madrid's Usera and Carabanchel, Valencia's Patraix, and Malaga's Carretera de Cádiz, where lower purchase prices combined with solid rents create attractive returns.
These top-yielding neighborhoods in Spain typically deliver gross rental yields between 6% and 8%, compared to just 4% to 5% in premium central areas where property prices have outpaced rent growth.
The main characteristic that allows these neighborhoods to achieve higher yields is that property prices there have not inflated as dramatically as in city centers, while working-class and young professional tenant demand keeps rents stable and vacancies low.
We cover a lot of neighborhoods and provide a lot of updated data in our pack about real estate in Spain.
Where do tenants pay the highest rents in Spain in 2026?
As of early 2026, the three neighborhoods where tenants pay the highest rents in Spain are Madrid's Salamanca (around 28 euros per square meter), Barcelona's Sarrià-Sant Gervasi (around 24 euros per square meter), and San Sebastián's Centro (around 18 euros per square meter).
A standard two-bedroom apartment in these premium Spanish neighborhoods typically rents for 1,800 to 2,800 euros (1,940 to 3,020 USD) per month, with renovated units in the best buildings commanding even higher prices.
What makes these neighborhoods command Spain's highest rents is not just location but a combination of historic architecture, prestigious addresses, proximity to elite private schools, and access to luxury shopping and dining that wealthy tenants prioritize.
The tenant profile in these highest-rent Spanish neighborhoods typically includes senior corporate executives, diplomats, wealthy international families, and professionals in finance or law who value prestige, security, and the social signaling these addresses provide.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Spain. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
What do tenants actually want in Spain in 2026?
What features increase rent the most in Spain in 2026?
As of early 2026, the three property features that increase monthly rent the most in Spain are air conditioning (essential in southern cities like Malaga and Seville), a working elevator (critical in buildings over three floors), and a renovated modern kitchen and bathroom that signal move-in-ready quality.
Air conditioning alone can add a 10% to 15% rent premium in hot Spanish cities because tenants will pay significantly more to avoid suffering through summer months where temperatures regularly exceed 35 degrees Celsius.
One commonly overrated feature that Spanish landlords invest in but tenants do not pay much extra for is luxury flooring like marble or high-end parquet, which adds substantial renovation cost but rarely translates into meaningfully higher rent.
An affordable upgrade that provides strong return on investment for landlords in Spain is installing fiber-optic internet and ensuring fast, reliable WiFi, which costs only a few hundred euros but attracts remote workers and professionals willing to pay more for connectivity.
Do furnished rentals rent faster in Spain in 2026?
As of early 2026, furnished apartments in Spain typically rent 20% to 40% faster than unfurnished ones in high-mobility markets like Madrid, Barcelona, and Valencia, where students, expats, and professionals need move-in-ready homes.
Furnished rentals in Spain command a rent premium of roughly 10% to 20% over unfurnished equivalents, though this comes with higher upfront investment and increased wear-and-tear that landlords must factor into their returns.
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How regulated is long-term renting in Spain right now?
Can I freely set rent prices in Spain right now?
In most of Spain, landlords can still set initial rent prices based on market conditions, but in officially declared "zona tensionada" (stressed market areas), new contracts face price constraints, especially for large landlords with more than five properties.
Annual rent increases during a tenancy are now capped by the IRAV index (around 2.2% in early 2026) for contracts signed after May 2023, replacing the old CPI-linked system and limiting how much landlords can raise rent each year.
What's the standard lease length in Spain right now?
The standard lease length for primary residence rentals in Spain under the LAU is a minimum of five years when the landlord is an individual, or seven years when the landlord is a company, with automatic annual extensions if neither party gives notice.
The maximum security deposit (fianza) a landlord can legally require in Spain is one month's rent for unfurnished properties or two months' rent for furnished ones, though additional guarantees like bank guarantees or personal guarantors can be negotiated separately.
Spanish law requires landlords to return the security deposit within one month after the tenancy ends, minus any legitimate deductions for unpaid rent or documented damages beyond normal wear and tear.
We made this infographic to show you how property prices in Spain compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
How does short-term renting really work in Spain in 2026?
Is Airbnb legal in Spain right now?
Airbnb-style short-term rentals are legal in Spain but heavily regulated, requiring both a regional tourist license and a national registration number (VUD ID) to legally list on platforms like Airbnb or Booking.com.
To operate a short-term rental in Spain, you must first obtain a regional license (called VUT, HUT, or ETV depending on the autonomous community), then register on the national Ventanilla Única Digital platform, which has been mandatory since July 2025.
Night limits vary by region and municipality in Spain, with some areas imposing caps (Barcelona limits unlicensed owner-occupied rentals to 120 days per year) while others have frozen new licenses entirely or plan to phase them out.
The most common penalty for operating an unlicensed short-term rental in Spain is fines ranging from 3,000 to over 60,000 euros depending on the region, plus immediate removal of your listing from booking platforms and potential property closure orders.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Spain.
What's the average short-term occupancy in Spain in 2026?
As of early 2026, the average annual occupancy rate for short-term rentals in Spain is around 55% to 65%, meaning properties are typically booked for roughly 200 to 240 nights per year.
Realistic occupancy rates in Spain range from 45% in seasonal coastal markets to over 75% in year-round tourism hubs like Barcelona, Madrid, and Malaga where business and leisure travel sustain demand throughout the year.
The highest occupancy months for Spanish short-term rentals are June through September (peak summer season) and during Easter week, Christmas holidays, and major local festivals like Semana Santa or Feria de Abril.
The lowest occupancy months for short-term rentals in Spain are typically January and February, when tourism drops sharply after the holiday season, though city-center properties in Madrid and Barcelona maintain steadier year-round bookings than beach destinations.
Finally, please note that you can find much more granular data about this topic in our property pack about Spain.
What's the average nightly rate in Spain in 2026?
As of early 2026, the average nightly rate (ADR) for short-term rentals in Spain is around 110 to 130 euros (120 to 140 USD), though this varies dramatically by city, property type, and season.
Realistic nightly rates in Spain range from 60 to 80 euros for basic apartments in secondary cities up to 200 to 350 euros for premium properties in Barcelona's Gothic Quarter, Madrid's city center, or luxury coastal villas.
The typical nightly rate difference between peak season (July-August) and off-season (January-February) in Spain is 40% to 60%, meaning a property charging 150 euros per night in summer might drop to 80 or 90 euros in winter to maintain bookings.
Is short-term rental supply saturated in Spain in 2026?
As of early 2026, short-term rental supply in Spain's most popular tourist neighborhoods is highly saturated, and new regulatory barriers mean the number of active listings is either stable or declining in many major cities.
The trend in active short-term rental listings varies by city: Barcelona's licensed inventory is frozen and will disappear by 2028, Madrid has paused new licenses until 2026, while smaller cities like Valencia and Malaga still see modest growth in properly licensed properties.
The most oversaturated neighborhoods for short-term rentals in Spain include Barcelona's Ciutat Vella and Eixample, Madrid's Centro and Sol, Malaga's Centro Histórico, and Palma de Mallorca's old town, where competition is fierce and regulatory scrutiny is intense.
Neighborhoods that still have room for new short-term rental supply in Spain include emerging areas in Valencia like Poblados Marítimos, Malaga's outer districts like Teatinos, and secondary cities like Alicante and Seville where tourism is growing but saturation has not yet peaked.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Spain, we always rely on the strongest methodology we can … and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| INE (Spain's National Statistics Institute) | Spain's official statistics agency publishing the IRAV rent index. | We used INE data to explain how annual rent update caps work for contracts in Spain and to anchor the IRAV values landlords must follow. |
| BOE (Urban Leases Act / LAU) | Spain's official legal gazette containing the core landlord-tenant law. | We used the LAU to describe lease length norms, deposit rules, and landlord obligations for long-term renting in Spain. |
| BOE (Housing Law / Ley 12/2023) | The national Housing Law shaping rent rules and tension zones. | We used this law to explain when rent-setting is constrained in "zona tensionada" areas and why rules differ by region. |
| Agencia Tributaria (AEAT) | Spain's official tax authority for non-resident income tax rates. | We used AEAT data to anchor tax-rate information (19% vs 24%) in our net yield calculations for foreign landlords. |
| Idealista | Spain's largest property portal with consistent rent index methodology. | We used Idealista to estimate current advertised rents and validate monthly rent ranges for studios, one-beds, and two-beds. |
| Fotocasa | Major Spanish property platform with a long-running rental index. | We used Fotocasa to triangulate rent growth and levels, ensuring our estimates are not based on a single source. |
| AirDNA | Widely used short-term rental analytics provider tracking Airbnb and Vrbo. | We used AirDNA to anchor realistic occupancy and nightly rate ranges for short-term rentals across Spain. |
| Global Property Guide | Recognized cross-country housing dataset provider with yield benchmarks. | We used Global Property Guide to triangulate gross rental yield estimates and validate city-level comparisons. |
| Banco de España | Spain's central bank providing authoritative housing market risk analysis. | We used Banco de España reports for macro context on why rents stay pressured due to supply-demand imbalances. |
| AP News | Major international news outlet reporting on enforcement actions. | We used AP News coverage of Spain's Airbnb fine to demonstrate that short-term rental enforcement is real and aggressive. |
We have made this infographic to give you a quick and clear snapshot of the property market in Spain. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
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