5 Tips on renting out your holiday home in Spain
At Rental Central Spain , we're a small, locally-based vacation rental and management company that's absolutely head over heels for our region. We thrive on showcasing its beauty to guests, all while providing top-notch management services to our property owners. With our tireless efforts and savvy strategies, we're committed to delivering nothing but the highest quality service. From managing and renting out holiday homes to refurbishing and redecorating them, we're here to make your vacation home an income machine and a beautiful place to enjoy!
A guide to renting out your holiday home in Spain
Spain is a relatively safe bet when picking a location to buy a vacation house to rent out, attracting 82 million tourists annually and ranking as the second most popular tourist destination in the world. Spain's three most popular tourist attractions on the mainland are Catalonia (where Barcelona is located),
Andalusia, and Madrid. While tourists also enjoy visiting the Balearic Islands and Canary Islands greatly.
Renting out your Spanish vacation home can be a terrific method to contribute to its costs and ongoing upkeep. It occasionally comes with complications, though. In some places of Spain, there has been a crackdown on vacation rentals due to criticism of mass tourism in already crowded areas. If you plan to rent out your vacation home, it's crucial to make sure you understand and abide by the local rules. There is also the issue of how to lease the space and who will oversee reservations. If things don't go as expected, what do you do?
Here are our best recommendations for protecting your investment in your ideal vacation house in Spain from turning into an absolute disaster!
- Do the maths.
Make important to determine whether the finances work out before deciding on pirchasing a home in Marbella..
You must account for costs like community fee(paid every month )management fees, cleaning costs, and maintenance costs if you need a specific amount of rental income to pay for the purchase and/or maintenance of the property.
2. Ensure that renting the home out as a vacation rental in Spain is lawful.
You need a license to rent out a vacation house in most regions of Spain due to recent restrictions on vacation rentals enacted in an effort to keep housing costs affordable for locals. You could face significant fines if you don't have a current vacation rental license!
For instance, starting in July 2018, Palma in Mallorca will become the first Spanish city to outlaw the practice of renting out vacation apartments to travelers in the style of Airbnb. For the past two years, Andalusia has had a stringent stance on vacation rentals. However, during that time, the Andalusia local government issued more than 26,000 permits for vacation rentals, and as of Spain as of February 2018 changed the law to make it simpler for Andalusians to rent out rural properties.
Do your homework and confirm that your property satisfies the requirements: (such as having central heating and air conditioning, for example) for holiday rentals according to local law if you wish to rent it out as a vacation rental in Spain. Some older homes might not be up to the very minimum requirements, and updating them can be pricey. So bear that in mind when looking at homes, and be sure to let your real estate agent and lawyer know that you want to rent the house out as a vacation home.
Top tip: Keep in mind that Spain has 17 autonomous regions, each with unique legal intricacies, so we strongly advise consulting with a Spanish attorney before making any decisions.
For a recommended independent Spanish, Geman, French and English-speaking attorney, contact our staff at:
0034 642 80 75 73
3. Choose a reliable holiday let company
One of the biggest benefits of using a vacation rental agency is the time and hassle it can save you by taking care of the day-to-day management of your property, including managing staff, handling bookings and payments, responding to inquiries and complaints from guests, and staying on top of maintenance.
When using booking managment platform, agencies will make sure there are no double bookings and no misunderstandings by using a booking management system. In addition to being advantageous for your consumer, doing this will spare you the inconvenience of having to disappoint some clients in the event that a double-booking error has been made.
Customer satisfaction is a crucial component of making sure your business as a property landlord is as successful as it can be. How well do you anticipate your property performing without it?
Making sure that your guests have the finest possible experience will assist generate positive evaluations for your establishment, luring new potential guests to stay or even luring previous guests to come back.
Once your home is being handled by a property management business, you will be relieved to put an end to future client inquiries, which may rapidly turn into a full-time burden.
Consider how much time you really have to devote to managing a vacation rental because even seemingly insignificant duties can quickly pile up. Even while maintaining your vacation rental yourself can save you money, hiring a management agent may be a wise investment if it frees up your valuable time.
The distance you must travel from your house to your vacation rental must also be taken into account. Consider how long a trip it may be to perform anything as basic as changing a lightbulb if you don't live close to your property.
4. Pay your taxes
Similar to many other nations, Spain has a convoluted tax structure that can be challenging to navigate, especially if you don't live there regularly. Regardless of whether you dwell in the house permanently or not, Spanish homeowners are obligated to pay IBI Tax (Impuesto sobre Bienes Inmuebles), which is comparable to council tax in the UK.
Additionally, if you rent out your vacation property, you must report your rental revenue to the Spanish tax authorities. Spanish property owners who are non-residents must pay two taxes:
Non-Resident Imputed Income Tax is a yearly tax that needs to be filed by December 31st of each year.
Spain charges a quarterly rental income tax
If you can show your income and costs with the proper paperwork, you can deduct expenses like mortgage payments, maintenance fees, management fees, etc. from these taxes in Spain as an EU or EEA citizen.
The tourist tax (tasa turistica), which is charged to all visitors to Spain and its Islands who are older than 16, should also be taken into account when determining your prices. In the priciest areas, like the Balearics, where the tourist tax has recently quadrupled to help safeguard the Islands' resources, the tax can cost up to €4 per person, per day, depending on the kind of lodging (such as camping, an apartment, a luxury hotel, etc.).
You won't have to charge IVA (Spain's equivalent of VAT) if you're not offering any services like regular cleaning, catering, or transportation. If you do offer these services, you must charge 24.5% IVA, register with the tax office as an IVA provider, and make sure to keep 24.75% of your earnings, which must be paid at the end of the year. If you hire a management company to take care of your vacation rental in Spain reservations, they ought to take care of this for you.
Top tip: Appointing a fiscal representative in Spain can help you navigate the complexities of the tax system in Spain. Contact Rental Central at rentalcentralspain@gmail.com for recommandation of local tax expert.
5. Insure your property
You must make sure that your Spanish property is adequately insured for use as a vacation home. Make sure your policy extends beyond a building and contents insurance policy and covers you for renting out the property as a vacation rental, not just a typical rental property. Verify the policy's coverage of public liability insurance. Are you protected while no one is occupying your property? Does it provide coverage for lost rent or wages?
