Recent reforms affecting holiday home lettings have produced conflicting advice and confusion among Spanish home owners as to how they need to comply when letting out their property, and indeed if they can let them out at all, according to Will Besga, a Mallorcan-based lawyer.

Besga said: “When the Balearics Tourism Act came into force last year, it left apartments and other types of properties out of the touristic regulation. This generated waves of confusion amongst holiday-home owners, particularly owners who ceased to rent their properties believing that it was forbidden, associating the lack of licences for apartments with a ban on renting them. Worst still for the market, many decided not to buy Spanish properties altogether for fear of not being able to rent them out and thus not being able to pay for the mortgage.”

The most recent reform of the Spanish Tenancy Act, commonly known in Spain as ‘LAU’, published this month (June 2013) and now in force across the whole of Spain, however, confirm that property let on a short term ‘touristic’ basis is subject to a given region’s touristic legislation, or will be subject to them for those regions that still lack them.

Pending the application of the law by the authorities, Bega explained that just like before you should still be able to rent out properties, such as apartments and terraced houses for which you cannot get a licence in the Balearics, on a short term basis through the Tenancy Act, if you are not engaging in the provision of services.

Besga added: “It is, however, important to ensure that a suitable contract is drawn up incorporating elements of the Tenancy Act and leaving ‘touristic’ elements out of the contract. What constitutes a ‘service’ is far reaching, and you should also pay attention to how property is advertised on the internet and the wording used.

“Similarly, in the Balearics, if you have a detached or a semi detached house, you still have the option to decide whether to rent it out touristically, or whether you prefer not to offer any services and rent your property out non-touristically. Given, however, that the new law intends to subject touristic rentals to the regional touristic law, and the latter regulates detached houses and semis, I consider that if you have a detached or semi-detached property, it would be prudent to get a licence and offer services.”