Small landlords across Spain are pulling thousands of homes out of the long-term rental market, according to two separate reports over the past two days, as a reissued government decree rewrites the terms of standard residential tenancies. Citing data from Spain’s National Federation of Estate Agents’ Associations (FAI), which represents more than 600 agencies nationwide, Sur in English reported on October 13 that regulatory uncertainty had affected more than 5,758 property listings over the preceding ten days alone — with 4,235 properties either fully withdrawn or diverted away from traditional long-term leasing, and 1,523 pending rental contracts frozen. Separately, Majorca Daily Bulletin reported on October 14 that the Balearic Islands’ rental market has “ground to a halt,” quoting José Miguel Artieda, president of the region’s estate agents’ association, who said viewings, new listings and lease renewals are being cancelled as owners grow fearful of losing control over their properties.
For anyone renting — or renting out — a home in Spain, the practical trigger both reports point to is Real Decreto-ley 28/2026, a decree published in the Boletín Oficial del Estado (BOE) on October 7. It rewrites Article 10 of Spain’s 1994 Urban Leases Law (LAU): once a residential tenancy passes its minimum term — five years for an individual landlord, seven if the landlord is a company — the contract now renews automatically for a further term of the same length unless either side gives notice, with the landlord’s notice period extended from four to six months. A landlord who chooses not to renew must generally pay the tenant compensation, calculated from the property’s reference value and length of residence, payable when the home is handed back; no compensation is owed if the landlord needs the home for personal or family use, the tenant isn’t actually living there, or the tenant has another suitable home available. Majorca Daily Bulletin describes this in practice as an effectively “indefinite” tenancy unless the landlord pays up to 12 months’ rent to end it — a specific figure attributed to that report, not independently confirmed in the decree’s own preamble text.
The decree is a reissue, not a first attempt. Its own preamble states that Congress’s plenary repealed the original version — Real Decreto-ley 27/2026 — on September 29, 2026, which triggered mass protests in major Spanish cities over the following weekend and led to an extraordinary Cabinet meeting on October 5 that dissolved Congress and the Senate and called a general election for November 29, 2026. The government readopted the measure as Real Decreto-ley 28/2026 on October 6, alongside a separate companion decree, Real Decreto-ley 29/2026, covering seasonal and room-rental rules and a VAT change on short-term tourist lets (previously reported by Zagdim) — a distinct instrument from the long-term tenancy rules at issue here. Both October 6 decrees still require validation by Congress’s standing committee, the Diputación Permanente, within a month of issue; Majorca Daily Bulletin reports the government believes it has enough votes there to ratify at least the measure extending leases and restricting evictions for vulnerable tenants.
FAI itself, quoted by Sur in English, says “legal uncertainty is driving an exodus of private property owners” and warns that total rental transactions could fall by 25 to 30 percent “in the coming weeks” as small owners halt new contracts or exit the sector — some shifting properties to outright sale, others to seasonal or room-by-room lets outside the traditional rules. Artieda, quoted by Majorca Daily Bulletin, goes further: he expects the remaining landlords who do rent out homes to charge higher rents to offset the added uncertainty, calling the net effect of the decrees “the exact opposite of the intended goal” and warning they will make housing access in Mallorca “even more difficult.”
References
Sur in English – Spain’s Small Landlords Withdraw Thousands of Properties From Traditional Rental Market Over Government Decrees / Majorca Daily Bulletin – Mallorca Rental Market Has “Ground to a Halt” Because of Spanish Government Decrees / Boletín Oficial del Estado – Real Decreto-ley 28/2026, de 6 de octubre
