Renting a property in Tenerife

Many people who want to live in Tenerife long-term rent a property here before buying. This is good practice, because there are so many variables in terms of dwellings and areas, and many people commit to a purchase only to find that they are homesick, or their circumstances change, within a year or two and they are then left with a property to sell in what, particularly at present, might be a difficult market.

If you are using an agency, view the widest range of properties. There will inevitably be much doubling up of properties, with owners putting their properties on the books of as many agents as possible to secure a tenant. Check that the property you are considering isn’t on other agents’ books: it might be available at a lower rent. You can also rent privately, and should look out for signs saying se alquila, which means “for let”. Don’t be afraid to ring these numbers thinking the landlord is going to be Spanish. Many English owners will use them too because they will be hoping to attract the widest possible range of enquiries, from prospective Spanish tenants as well as English.

When renting, you should be aware that there are two types of rental contracts here – short and long term – and the length of a rental contract will vary depending on which it is. Long-term contracts (contrato de arrendamiento de vivienda) are the only residential lets properly speaking, and are for a minimum of one year. The tenant is protected by law to a very high degree, including having the right to renew the contract for up to a further three years, with rent increases at no more than the rate of inflation. Some owners do not relish the prospect of having a tenant with such highly protected rights, however, and so short term contracts (contrato de arrendamiento por temporada) are common, running normally for three or six months, but can be up to a year. Whatever length of time the contract covers, its terms are binding on both sides, and it will not have a period of notice because each side must honour the full contracted period.

It is important to note, however, that temporada contracts are not in any case intended for habitual residential purposes. Indeed they are contracts for a specific purpose, e.g. temporary work placement, study, etc., and not for habitual residence. Indeed, the tenant’s primary habitual home address must be detailed on the contract. They also cannot be for tourism purposes, and Turismo says that any such contract under three months will be deemed as touristic by the Government, and fines issued against owners where they are offering such lets illegally. Put simply, specific purpose temporada contracts are perfectly legal if issued for a genuine short-term purpose, and not for holidays or permanent living, and any tenant who is given one for residential purposes, and is then fobbed off with repeated temporadas instead of being given the vivienda contract they should have by law can appeal to the Courts on the grounds that this is an habitual home where the owner is trying to avoid providing full legal rights. The Courts are very sympathetic to tenants in these circumstances, and can require the owner to provide a long-term residential vivienda contract.

To be fully legal, contracts must be signed by landlord and tenant, and contain ID numbers (NIE for foreigners) of both. Strictly speaking, rental contracts should be signed before a notary and registered at the Spanish Land Registry (Registro de la Propiedad), but the reality is often much more informal. Along with the contract you should get an inventory of items in the property, and the condition they are in. Check these thoroughly, because if there is any discrepancy, it is likely to involve a deduction from your deposit when you leave. If there are any marks or damages, particularly if these are not specified in the inventory, take photographs, and resolve the issue as early as possible rather than waiting until you vacate.

You can expect to pay your rent in advance, and therefore the first month’s rent will be payable when you take possession. I am sometimes asked about agents putting up rent in the middle of contracts, or “at renewal”, and as should be clear from the above, it is only in long-term vivienda contracts that the issue arises because temporada contracts are for a single set period, and a vivienda contract will have the legally-allowable increases already written into it. There cannot actually be any reason for an agent or owner to increase the amounts agreed to and written into a contract.

Apart from paying rent in advance, you will also almost certainly be asked to pay a deposit which will be held against any damage or debt incurred during your tenancy – note that landlords may not keep deposits or make deductions from them for cleaning or redecorating after a tenant leaves, and any deductions made must be detailed in writing, with justification, and must be agreed by the tenant. Equally, if repairs or justifiable expenses exceed a deposit, then the tenant must pay immediately. If either side fails to comply with these requirements it is a matter for legal action and the courts. If all is well, however, then the deposit should be returned immediately, and if not repaid within a month, will attract legal interest. The deposit may be called a deposit or a bond, or in Spanish, fianza: article 36 of urban letting legislation says that a deposit equivalent to one month’s rent is a legal minimum for long-term rentals (the requirement is two months’ deposit for uso distinto, i.e. other than for living in, e.g. a business), so the landlord is required by law to ask for this, as is the tenant to pay it.

Sometimes prospective tenants are asked for a deposit of more than the equivalent of one month’s rent, but this is uncommon, and if you are prepared to consider it, make very sure that it is in fact for a refundable deposit, rather than a non-refundable charge imposed by an agent, perhaps called a contract fee, or “finder’s fee”. Be aware that although many agents are honourable, some are not, so it is only safe to proceed on the grounds that your agent may not be so. What fees are “fair” or acceptable is naturally for each prospective tenant to decide for themself, but in any case, it is essential to determine the nature of all monies handed over, and for the amounts to be specifically identified in the contract, along with the fact that they are refundable. Needless to say, it is essential to get specific and clearly identifiable receipts for all monies handed over, whether deposit or monthly rental payments.

Some rentals include a certain amount for utilities usage, often up to around €50 or so per month, with the tenant paying any extra when the bill arrives. Apart from electricity and water, however, landlords themselves normally pay the rates (IBIs) and the community charge if the rented property is on a complex. Clearly it is important to know in advance what commitments there will be for ongoing expenses in addition to the rent, and these should be clearly detailed in the contract. Generally, however, the landlord should be expected to cover the IBIs (rates), community fees, basura (rubbish), house insurance and maintenance costs, whereas the tenant should anticipate paying metred amounts for utilities such as water, electricity, gas and telephone. In the event of breakdowns, the landlord is usually responsible for washing machines, boilers, etc. (unless the breakdown is very minor or the result of damage caused by the tenant), and the tenant for any damage s/he has caused or which has resulted from general usage (e.g. a broken window or a blown lightbulb), and tenants are recommended to take out their own contents/accidental damage insurance for such eventualities, as well as for cover of their own possessions. While speaking of utilities and the like, it is worth mentioning that from 1 June 2013, owners are obliged by law to provide a copy of an energy certificate for the property to all new tenants – existing rental contracts are exempt from the law (see HERE).

When leaving a rented property, tenants are required to give the period of notice stipulated in the vivienda contract. Under legislation which came into force on 6 June 2013, however, they will be able to terminate a contract by giving just one month’s notice, and no longer having to pay compensation, providing that they have had the contract for at least six months. Similarly, once the property has been let for a full year and the contract has been renewed, the owner of the property will only be able to recover it from that point for use as a main home with notice of two months. Legally this means that the owner must move into it and stay in it for at least three months, and cannot just say they want to live in it in order to get the tenant to move out for a different reason.

Tenants can also be evicted, of course, and the usual reason is for non-payment of rent. It is important to be aware that even if you feel justified in withholding payment, e.g. for requested repairs that have not been carried out, the law expects payment to be made and for the claim then to be dealt with separately. To date, tenants have been able to avoid eviction by paying rental arrears just before a Court hearing, at least on the first occasion, but under the 2013 legislation I mentioned above, landlords will be able to apply for eviction in just ten days if rent is outstanding. The Courts will grant the order unless the tenant can present satisfactory argument for non-payment – which would be difficult to do, evidently. Apart from non-payment of rent, a tenant may be evicted for sub-letting, using the property for a purpose other than living in it, intentionally damaging the property, or carrying out noisy, dangerous or illegal activities. Anyone who is evicted under these terms of the new law will, moreover, be recorded in a new rent debtors’ register which will be made available to landlords to check prospective tenants, so clearly it is to the tenant’s advantage to leave on good terms and with no outstanding issues if at all possible.

Please use the comments box below to ask any questions relating to the above, but please do not use it to seek or offer rentals, or ask for recommendations for agents. There are more agents here than one could begin to list, and I would think that in the main they are pretty much as good and effective as each other. All due caution is necessary, as always, in any transaction here, and independent advice on contracts signed and monies handed over is essential.

Finally, please see THIS page which details the specific letting framework for owners in the Canaries.

 

 

26 Comments

  1. Janet. I paid a 500 deposit for apartment for 2017. I paid the deposit in November 2016. As far as I was concerned I would contact the landlord in the summer in 2017′ II was in hospital in December and January, There was gossip going around Tenerife I was in a coma which was not true, This was related to the landlord by one of the gossip so he decided to rent the apartment to another person I am mad that I could lose the apartment because he listen to a gossip. I refuse now to take my deposit back as that would solve his problem. I got a written agreement from him. He said he can change his mind if he wants to, Do not feel like walking away because of some gossip. What can I do.

  2. Author

    He is bound by the agreement and the receipt you will have for your deposit. You can enforce this by taking legal action against him, but since this would be costly and time consuming, my advice would be to accept the refund of your deposit and just look for another apartment. You could perhaps also ask for some compensation for your time and effort in finding another apartment because he’s in breach of contract …

  3. Hi, We are looking to rent a 3 bed apartment in Adeje. And the agency are wanting 3 months rent upfront, 1 months deposit plus 1 months agency fee- the rent is 850 per month! Is 850 euros quite high for an agency fee which as far as im aware, we wont get back?

  4. Author

    Most often “agency fees” are not refundable. It is a high fee, but it is legal, as is asking for three months in advance when one is normal. It is entirely your choice whether you accept these terms or seek a different agent.

  5. Hi Janet,
    Firstly thank you for posting this article it’s really helpful.

    Me and my partner rented an apartment in Tenerife for short term 6 months however had the opportunity to extend the contract if we wished. The notice was two months before the original contract ended, as a tenant we had briefly spoken about continuing it but nothing was finalized. Initially our leaving date was the 10th of February and our contract states that unless there is a signing of a new contract the original will end automatically. So we notified our agency a month before because unfortunately something came up back home so we had to leave that we wouldn’t be continuing. They stated to both me and my partner that as long as there were viewings straight away the deposit shouldn’t be a problem, there was actually a viewing the same week so my partner cleaned the entire apartment top to bottom which in fact made it look better than what it was when we first moved in. The lady who showed us the apartment that then showed the new tenants at the day of the viewing said to my partner that the apartment was spotless and that the deposit shouldn’t be a problem. When we left we left on good terms and even gave the correct bank details they needed for when returning the deposit. We left on the original date stated in the contract but now we are back in the U.K. Refusal of the deposit has been stated because we didn’t give the right notice when in fact we did. We were also mislead in believing we would get it back before we left because now as if stands they are refusing to give it to us. What’s the best route to take?
    Thanks
    Autumn

  6. Author

    Getting deposits back here is a perennial problem, and your only recourse is legal action with a lawyer in the first place trying to get an agreement for return, and then going to Court if that is unsuccessful.

  7. Hello Janet
    I have a bit of a predicament.
    I am renting of which is totally not suitable ..but I have found one that is …my contract runs out on 30th April. The landlord will not update anything. However will the agency give me back my deposit without fulfilling the contract .the new owner may not hold until end April

  8. Author

    If you have a temporada contract both you and the owner are required to honour it, which means paying for the whole term. So I would not think you’d get your deposit back if you fail to do this, and technically, the owner could also come after you for any rent owing for the remainder of your contract.

  9. Hi Janet, my partner and I will shortly be kicking of the process to rent an apartment short term. Is it customary that I have a local bank account to pay rent or can i do this cash in hand with the agent if needed? Asking at the bank yesterday they need a P60, payslips (which i cannot provide as an IT contractor) and proof of address to open an account. Thanks in advance for your time.

  10. Author

    You can do whatever is agreed, which is likely to be stipulated in your contract. Bear in mind that if you wish to declare rent in any tax return here you will need receipts, and you should have receipts anyway for any deposits you pay, specifically listing what they are for and whether they are refundable. Unfortunately it is far harder over recent years to open bank accounts here, but not all banks have the same requirements … so it might be worth asking around.

  11. Hi janet
    We are thinking of comeing to tenerife and trying a short term rent to see if we like it and as we have only been on holiday here i am going to retire at 60 and my wife do not work if we like and dont miss the grandkids too much we might look for longer term rent as we love tenerife on holiday
    Is this posibible please as we like to give it a go as we woyld like to spen the rest of our days on this lovely island

  12. Author

    Yes, it’s entitrely possible. It’s not all that easy to find rental properties but have a look on Facebook – type “rental property tenerife” in the search box and you should find a few options come up, and any of them will put you in direct contact with owners and agents. See what’s available – you will probably find that most owners only want to give short term contracts anyway.

    The most important thing is to ensure that you are being offered a contract, and get it checked out by an independent adviser or lawyer before you sign it … and before you hand over any money. Technically you will be “on holiday” here as you’re just coming to see how it feels to be here, so you won’t officially be “living here”, and as such you won’t need to register with the police. You will probably need a NIE and a bank account here, but you can do that as “non-resident” visitors.

  13. My brother has taken early retirement and is looking to move to Tenerife (he has been visiting for the last 30 years) and will be staying in my apartment. He will be my personal guest. I take it he will not need a contract as such and this will not be deemed illegal. The apartment is on a residential complex.

  14. Author

    no, you don’t need to give your family or private guests contracts, and you have full constitutional right to use the apartment for any private purposes that don’t break any laws.

  15. Hi Janet,
    We are long term renters and have been in the same apt now for 19 months al be it that we have an eleven month rolling contract which is due for renewal in October 2017. The agent is talking about increasing our rent be €50 a month. We already pay€850 plus bills. She says that there are others on our row paying €1100. Can she do this? She says there are other people that will pay that which is a bit intimidating as she could give us notice to quit.
    Would appreciate your thoughts

  16. Author

    I’ve moved your question to the page which explains all about these contracts and your rental rights because you aren’t really asking about “illegal letting”. As you will see above, your contract gives you no protection against increases because it is not a “rolling contract” at all, but separate short-term ones which are viewed by the courts as an attepmt by owners to get around giving you those protections.

    You can ask for a proper residential three year contract which gives you full tenant rights, being prepared to take private legal action to make application to the courts for your second contract to be made into a long-term residential one with full tenant rights, an application which would be viewed favourably. The only alternative is to move and find somewhere where you are given a fair and legally recognized contract.

  17. Hi Janet, as a long term tenant what rights would I have if the owner decided to sell the property that I have been renting over the past few years?

  18. Author

    As it says above, your contract must be observed … an owner can give you notice but only if the intention is that s/he is going to live in the property. Otherwise, the property must be sold with you as a sitting tenant and your contract must be honoured by the new owner.

  19. hi Janet, this has answered many of our questions! we are contemplating renting out a cottage separate from but within our property for a 12 month period to someone on placement here from mainland Spain. So far we have only used it when friends come to stay, and now the novelty of our living here is wearing off it’s a shame to see it unused. Obviously we will have to declare the income we receive on our tax return, but do you know if we need to charge the equivalent of VAT on the rent and therefore register somehow for that as well?

  20. Author

    I don’t believe you need to charge IGIC on long-term or “short-term” specific purpose rentals but as I always say with all tax issues, please check with a qualified tax adviser because I am not one. The onlt thing re IGIC that I am sure of is that it must be charged on holiday rentals under the Vivienda Vacacional scheme (see HERE).

  21. thanks, will add it to our list of questions when we go to get the contract etc drawn up but useful to have a guideline now. Thanks for the help, as always.

  22. Hi Janet
    I notice on estate agent in the North – Porta Tenerife -requiring a commission payment of one months rent
    Obiviously I do not agree with this but as I have not seen it elsewhere hope this is the exception ???

  23. Author

    As it says above, various systems apply, and it is up to the prospective tenant what they accept. A commission of one month’s rent is not all that unusual.

  24. Hi Janet can I just ask in your rental contract when it says the tenant is liable for the electricity do the pay for electricity used or all of it including standing charge/tax ect?
    Asking for a friend tia

  25. Very good advice article. Well done.

  26. Author

    If the contract says the tenant pays the electricity bills then I would expect to be the whole bill, unless stated otherwise. If the contract says the tenant pays for electricity used then I would it expect it only to be the consumption costs. It depends what is specified in the contract.

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