Unlocking Success: all about the Spanish Rental Licence

Welcome, future Spanish property owners! At Hansson & Hertzell, we understand the excitement of investing in the vibrant real estate market. It is a lucrative investment, especially since the interest in Spanish tourism is still growing every year. 

A passive monthly income has become a new form of making money without needing to be employed.  Add tax advantages and real estates' capacity to work as a buffer against inflation, and it becomes clear why so many people decide to invest in real estate right now. 

 As you embark on this journey, it's crucial to familiarize yourself with the rules for your specific rules for owning a property in Spain. Each municipality has its own set of standards, so this guide will focus on general rules, and go more in depth on the Valencian Community specifically.

In this comprehensive guide, we will discuss what kind of properties are eligible, technical requirements and other ins and outs of the tourist rental licence. Key elements for anyone looking to turn their property into a holiday haven, and make some money in the meantime. 

1. What is the Tourist Licence?

Let's kick things off with the basics. The tourist licence, or “Licencia de Turismo,” is a legal requirement in Spain that allows property owners to rent their homes short-term to tourists. 

It's essentially the golden ticket that legitimizes your property as short-term rental accommodation. Only with this licence are you allowed to rent your property on platforms like Booking.com and Airbnb. 

2. Which properties are Considered as Tourist Accommodation?

There are three types of rentals in Spain:

1. Short-term of tourist rental
2. Long term rental
3. Medium-term or seasonal rental

The property is considered for the rental licence if it qualifies with the following criteria:

• The property is rented out for short periods, typically less than 30 days, to non-residents. 
• The property is rented for tourist, holiday, or leisure purposes.
• The property is rented out in full, and equipped for immediate use.
• The property is advertised on holiday rental platforms, such as Airbnb.
• The property is rented out in return for financial compensation.
• The property complies with the tourist and town planning regulations.

3. Private v.s Business Tourist Licence

Understanding the nuances of private and business licences is crucial. A private tourist licence is for those renting out their primary residence, while a business licence is necessary for owners operating multiple properties or renting out secondary residences. Knowing the distinction can save you from legal headaches down the line. 

The Valencian Community, Decree 15/2018 implies you must register your property in the HRVR (Valencian Holiday Rental Registry):

• As private: if you rent out 1–4 properties
• As business: if you rent out more than 4 properties 

4. How to Obtain the Tourist Licence?

Now that you're convinced, the next step is obtaining the licence. First, you’ll apply to the City hall to obtain the municipal urban compatibility report. Once this is done, you’ll need to present the following documents: 

• Declaration of intent to use the property for tourism purposes
• Property information: address, occupancy, etc.
• Property documentation: insurance, nota simple, energy certificate.
• Copy of identity of the owner.
• Cadastral reference number.
• Municipal urban compatibility report, which approves the tourist accommodation. 
• Application form

Presenting this documentation can be done in multiple ways:

1. By internet, in case you already have an electronic DNI or digital certificate.
2. In person, directly to the Servicios Territoriales de Turismo (Tourism Territorial Services).
3. By post, at the post office.
4. In Consulates or Embassies

Registering your property is free, and once your documents are approved, you’ll get a licence number that looks like this:

• VT / Number / V for Valencia
• VT / Number / A for Alicante
• VT / Number / C for Castellón

VT is for Viviendas Turisticas. If you register more than 4 properties, it will be replaced by EGVT for Empresas Gestoras de Viviendas Turísticas. This number needs to be included in all advertisement you do.

Navigating this bureaucratic maze may seem daunting, but fear not – our experts at Hansson & Hertzell are here to guide you through every step.

5. Properties Technical Requirements

Your property must meet specific technical requirements to ensure the safety and comfort of your guests. These may include fire safety measures, adequate ventilation, and suitable furnishings. Our team can help you understand and implement these requirements seamlessly. The standard qualifications are:

• A lift from the 4th floor
• Thermal and acoustic insulation in the home
• Electrical outlets in all rooms with voltage indication
• Hot water
• The evacuation plan located on the front door
• The list of emergency and interest telephones, posted in a visible place
• A fully-equipped kitchen
• Wardrobes in the bedrooms
• All furniture

Some municipalities have stricter or more lenient policies towards these standards, so make sure to verify which rules will be in place for your desired location. 

For a complete list of requirements and in-depth information, consult the Consolidated Legislation or reach out to the Hansson & Hertzell team for more help with the process.

6. I Obtained My Tourist Licence – What do I do now?

Congratulations on securing your licence! Now you can start making money to win your investment back. As a responsible property owner, it's essential to be aware of your obligations. Theses include: 

A. Correct advertising

It is important to be honest in your advertising and provide sufficient information about your property. You must also always include the registration number of your accommodation, as well as its category (standard / first / superior). Moreover, a tourist identification plaque with ID number must be visible at the entrance of your property. 

B. Guest Registration

 Owners must maintain a register documenting the dates and duration of stay for each guest. This register must be signed by both parties and submitted to the Policia Nacional or Guardia Civil within 24 hours of the rental period. Registering can be done in person, by fax or through the Guardia Civil and Police online portals. The register must be retained for a minimum of 3 years.

C. Complaints book

The territorial service of commerce will issue you a complaints book that must always be available to guests. The complaints files look like this.

D.  Compliance with Community Regulations

You must make sure to comply with community regulations regarding tourist rentals. Guests are expected to adhere to both the rules of the accommodation and the common elements of the building or urbanization. Owners are responsible for informing guests of relevant regulations and may be liable for any infractions committed by guests.

E. Protection of Personal Data

Owners are obligated to inform guests that their personal data is legally protected and processed. Additionally, guests must be informed of the retention period for their data and their rights to change, limit, or omit it.

F. Renewal

In order to continue your successful ventures, you must renew the licence every 4 years.

7. What Are My Rights as the Owner of Tourist Accommodation?

Understanding your rights is just as crucial as knowing your obligations. You have the right to set house rules, demand a reasonable price, receive security deposits, and choose your preferred rental platforms. 

In the event of a cancellation by guests, you have the right to a refund. The amount must have been determined in advance by the contract (in between 10% and 100%). If you cancel the booking, the guest can decide alternative accommodation or a monetary compensation equal to double the payment made in advance. 

You also have the right to terminate the agreement at any moment if the guest is not in compliance with the conditions of use. This could be the case if there are more people staying than initially booked for, if the property is sublet, or when other illegal activities are happening. 

Knowing the balance between rights and responsibilities ensures a harmonious rental experience.

8. What Are the Sanctions for Poor Tourist Rental Management?

Nobody wants to face sanctions, but being informed is the best prevention. Poor management, such as overcrowding or failure to meet safety standards, can lead to fines or, in extreme cases, the revocation of your tourist licence. Stay in the know to keep your investment secure.

Minor infractions: a warning and a fine up to €600

• Not displaying the identification badge at the entrance of the property.
• Bad treatment of customers. 
• Inadequate housekeeping or poor maintenance.
• Not keeping copies of invoices.
• Not announcing the existence of claim sheets

B- Serious infractions: suspension up to 6 months and a fine up to €6.000

• False or misleading advertising
• Lack of document required by law
• Breach of the contract or of the agreed conditions 
• Prices higher than those advertised on the ad
• Refusal to issue invoices
• Obstructing the access or duties of the Tourist Inspector

C- Very serious infractions: suspension up to 3 years and a fine up to €90.152

• Make short term rental without the tourist licence 
• Non-compliance with the current regulations
• Non-compliance with fire protection and prevention regulations
• Failure to comply with the advertising and communication obligations

9. Conclusion

Embarking on the adventure of real estate investment in Spain's Valencian Community is an exciting journey. The tourist licence is your key to success, ensuring a legal and lucrative short-term rental business. 

Remember, staying informed, embracing diversity, and understanding the specific influences on the Spanish real estate market will position you for a successful and strategic investment journey. 

At Hansson & Hertzell, we're here to make this process seamless, allowing you to focus on what matters most – turning your property into a sought-after holiday haven. Contact our team of professionals to find properties with the best rental potential, but also to receive assistance with obtaining the licence. We help you from beginning to end. Happy renting!

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