Why You Should Not Buy Your 10th Property in Spain

It seems that the Spanish government thinks that property owners should support some of the weight of the COVID-19 crisis. 

Many people having issues paying their expenses including rent, energy, gas and telephone lines is a result of the crisis. Now, the government is making an important difference between an owner with 10 properties or more and owners with less.

This is not big news really since something similar already happened in the spring when owners with more than 10 properties were forced to offer an extension to their tenants in case they had issues paying the rent.

On December 22, the Spanish government passed a new decree that forbids cutting basic supplies such as water, gas, or electricity to those consumers considered to be vulnerable. This may affect some owners who have agreed to pay the supplies to their tenants and get compensated after that, but the big bad news for owners goes farther. The government has also forbidden evictions until May 9, 2021.

The most polemic part is that the protection includes those who are living in a place without a contract, so it protects squatters as long as they are in a property that is not the home or second home of the owner.

How Does It Work?

Once the tenant notices they will not be able to pay, they will have to ask for an extension. Of course, ideally the tenant and owner could reach an agreement; but if that does not happen, the tenant will need to go to court to make the application.

After that, the court will ask for a report to the Social Services to check if the tenant is included in the vulnerable category. 

If the report is positive, the regional authority (Comunidad Autónoma) will look for an alternative housing for the tenant. 

If in three months the Comunidad Autónoma has not provided an alternative housing for the tenant, then the owner can ask for compensation. However, those who have at least 10 properties will need to show that the property was for sale or for rent (this is relevant for the cases in which there is not a tenant, but a squatter).


It seems that the Spanish government has put a clear limit of 10 properties for owners. Those surpassing that number may need to have more legal support at their disposal than before, at least until next May.

Of course, this measure will also affect investors. For example, SOCIMIS (Spanish version of Real Estate Investment Trust) are affected by these new regulations.

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