Investment approach
A flat bought to let: format, preparation and taxes in 2026
An investment flat's income starts with the rental format. How the October decrees changed temporary lets, room lets and IVA, what to prepare before listing and how to compare formats.
Letting a flat bought as an investment starts with choosing a format: a long-term residential lease, a temporary one, a room-by-room let or a tourist let. Since 8 October 2026, under Real Decreto-ley 29/2026 (a government decree-law), a temporary lease may be made only for a real and verifiable reason to live temporarily away from home, for more than 31 days and, as a rule, for no more than 12 months (BOE). Congress has not yet ratified the decree-law, so the format is chosen with a lawyer.
Which rental format to choose
The rental format is the legal regime of the contract: the term, rent growth, guarantees, taxes and when the flat will be free again all depend on it. After 8 October 2026 the formats differ as follows.
| Format | Main rules | What it means for the investor |
|---|---|---|
| Long-term residential lease | At least 5 years, 7 if the landlord is a legal entity; indexation no higher than IRAV (the state rent-update reference index) (art. 9, 18 LAU) | Stable income, but the flat will not be free soon |
| Temporary lease | A real reason, over 31 days, as a rule up to 12 months; additional guarantee of no more than one month's rent (art. 9 bis, 36.5 LAU) | Without a reason the contract counts as an ordinary lease from day one (art. 7.2) |
| By the room | The sum of the room rents does not exceed the rent for the whole flat (art. 17.9 LAU) | Income by the room is capped at the whole flat's ceiling |
| Tourist, up to 31 days | Outside the LAU (Ley de Arrendamientos Urbanos, the Urban Leases Act), a tourist licence is needed (art. 5.e LAU) | In Barcelona the licence question is decisive |
If more than two temporary contracts are made in a row on the same flat with the same tenant, or the term without justification has exceeded 12 months, the first contract is treated as an ordinary residential lease with all its terms (art. 9 bis.2). Rent growth between successive temporary contracts is limited by IRAV (art. 17.8). The Catalan rules on temporary leases and rooms continue to apply (DA 12.ª LAU, the twelfth additional provision). On tourist licences in Barcelona, see the article on the plan to phase out licences by 2028.
What to prepare before the first listing
Before listing, the documents are closed and it is checked what rent is permissible at all.
- Energy certificate. The class is stated in the listing, and the label is attached to the lease (art. 17 of RD 390/2021).
- Cédula de habitabilidad (habitation certificate). A valid cédula is needed to let (art. 26 of Llei 18/2007).
- Rent ceiling. Barcelona is on the list of stressed housing market zones (Generalitat). The new rent cannot exceed the last rent of the previous five years with indexation, except in cases with a surcharge of up to 10%, and for grandes tenedores (large holders of housing) the state index applies (art. 17.6–17.7 LAU), see the rent cap.
- Renovation before letting. From 1 December 2026, renovation works on a home let as the tenant's main residence are taxed at 10% IVA (VAT) if the building was built or refurbished at least two years earlier, the contractor's materials do not exceed 40% of the base and payment is not in cash: by card, transfer or a named cheque (art. 7 RDL 29/2026).
- Deposit. One month's rent, lodged with Incasòl (the Catalan deposit register) within two months. For main-residence contracts signed from 26 March 2026, Incasòl requires the report of the state rent price index system (SERPAVI) to be attached to the contract.
How the October 2026 decrees change income
The decrees touched four lines of the calculation, and all four come with a caveat: Congress has not yet ratified RDL 29/2026.
- Rent growth. Annual indexation no higher than IRAV, and until the end of 2027, without a new agreement, no more than 2%.
- IBI. Taxes tied to the flat are no longer passed on to the tenant (art. 20.1 LAU). IBI is the annual property tax.
- Short furnished lets. From 1 December 2026, the letting of furnished housing to a single tenant for no more than 30 nights is subject to IVA at 10%, if it is not the landlord's main residence.
- Resident's tax. For contracts after 1 December 2026, the reduction of taxable income under art. 23.2 LIRPF changes: from 100% to 15% depending on the rent and conditions.
The reductions of art. 23.2 relate to IRPF (resident personal income tax), that is, to tax residents. A non-resident pays IRNR (non-resident income tax) at 19% if living in the EU or EEA with an exchange of tax information, and at 24% in other cases (art. 25 TRLIRNR); the law lets only EU and EEA residents deduct expenses (art. 24.6). More in the article on non-resident rental income tax.
How to compare formats on one flat
Worked example, not a forecast. A flat in Barcelona, ownership costs of 3,000 € a year in both cases. Long-term at 1,500 € a month with no vacancy. Temporary at 1,800 € a month, but three months a year empty between tenants, plus cleaning and furniture renewal of 2,000 € a year (assumptions).
| Indicator | Long-term | Temporary |
|---|---|---|
| Rent for the year | 18,000 € | 16,200 € |
| Ownership costs | −3,000 € | −3,000 € |
| Furniture and cleaning | 0 € | −2,000 € |
| Balance before tax | 15,000 € | 11,200 € |
The monthly rent is 20% higher and the balance a quarter lower. What decides it is the length of vacancy and the demand from tenants with a verifiable reason. How to build the full calculation is covered in the article on net rental yield.
Manage it yourself or hand over management
Management includes finding tenants, the contract, the deposit, repairs and monitoring payment. Since 8 October 2026, the owner answers a request for a repair affecting habitability within 15 days; otherwise the tenant does the repair and deducts the cost from the rent (art. 21.5 LAU). For an owner abroad it is usually simpler to hand management to a company and put its fee in a separate line. The order of action on non-payment is covered in the article if the tenant does not pay.
When letting does not suit
It does not suit if the flat is planned to be sold vacant in a few years: from 15 November 2026, under Real Decreto-ley 28/2026, refusing to extend the contract after five years usually costs the tenant compensation. It does not suit if the calculation rests on a tourist let without a verified licence. And it does not suit when the balance after all costs and tax falls below the yield the investor accepts and the hope rests only on price growth.
Questions and answers
Where to start if the flat is bought and has to be let?
With the rental format, then the documents: energy certificate, cédula, a check of the rent ceiling in the stressed zone. Only after that the listing and the contract.
Can a flat in Barcelona be let by the month to foreigners?
A temporary lease from 8 October 2026 requires a real reason for temporary residence, a term of more than 31 days and, as a rule, no more than 12 months. Without a reason the contract counts as an ordinary residential lease from day one. Congress has not yet ratified the decree-law.
Is it more profitable to let by the room?
Not necessarily. Since 8 October 2026 the sum of the room rents cannot exceed the rent for the whole flat, and in the stressed zone the same limits apply as for a whole flat.
What tax does a non-resident pay on renting out a flat in Spain?
IRNR: 19% for EU and EEA residents with an exchange of tax information, who can deduct expenses, and 24% for the rest. The reductions of art. 23.2 LIRPF are written in the IRPF law, so a non-resident should go through their own situation with an asesor fiscal (tax adviser).
