Renting your property in Marbella – Numbers Crunching
Renting your property in Marbella to tourists during the summer months on the Costa del Sol is a profitable venture. At Location Moves, we are always trying to encourage Marbella property buyers to consider owning a holiday home, simply to take full advantage of holiday letting on the Costa del Sol.
Besides renting out your Marbella property for holiday letting, you might also want to consider renting out your property long-term. Which ever you decide, both ventures can be very financially beneficial. We’ve put together a helpful list of tips when it comes to renting out your Marbella property – this includes whether you decide short-term rental or long-term rental. This handy guide can help landlords avoid common mistakes, and in the end, help you keep money in your pocket where it belongs.
But first – Why consider renting your property for holiday lets?
It’s all about the numbers.
Since 2012, Malaga province has been breaking records on the tourism front. For example, in 2016 Andalucia received 10.6 million international tourists, which was 12% more than 2015, which was 8% more than 2013 and was 3% more than 2012. This years numbers have yet to be calculated, but it seems the predictions made for an even bigger influx of tourists came to fruition.
The President of the Junta de Andalucía, Susana Díaz, reports that in 2016, Andalucia received 10.6 million international tourists, which was 12% more than 2015. That tourism brought in 19 billion euros annually to the local economy and that Andalucía alone had 40 per cent more international visitors in 2017 than all of Brazil in an Olympic year.
The Head of Turismo Costa del Sol, Elias Bendodo, predicted 2.6 per cent more visits to Malaga province and the coast this year. “Everything points to an increase in 2017 on the record numbers last year,” he said. Most of the early reports are in fact surpassing that number.
As a sound property investor, you can clearly see the advantage of owning a rental property in Marbella. However, before deciding to rent out your property in Marbella to holiday makers or for long term rentals, understanding Spain’s rental laws and avoiding the most common mistakes can help fast track you to profitable returns. We’ve put together a list of top mistakes made by landlords and how you can avoid them.
Common mistakes made by landlords in Marbella
Some of these mistakes are more common then you might realise. There are far too many misconceptions that can also be classified as “myths” about specific rental laws in Spain. Besides getting into trouble with the government, some of these common mistakes can see Costa del Sol landlords criminally prosecuted by their own tenants. This alone is why it’s so important to understand the Spanish laws that govern renting your Marbella property out to holiday makers.
Many problems stem from lack of knowledge or simply understanding the legal implications of renting out a property in Spain. Lets start with one of the biggest mistakes landlords make here on the Costa del Sol…
#1 – Once you you rent out your property, you lose all access to it
Alright, this may sound harsh but believe it or not, it’s simply common sense. Generally, what renting entails is losing possession of your property for a certain and per-determined amount of time. You’ve put your property up for rent, someone decides to pay you for this rental, you sign an agreement for the amount of time this person is renting for, which means you can no longer enter the property for that per-determined amount of time.
Landlords cannot enter their own property even if it’s just for ‘inspection’ purposes without the said permission of the current tenants. This all too common mistake is responsible for most of the letting misunderstandings on the Costa del Sol.
#2 – Avoid urges for revenge
Just like number 1 sounded a bit harsh, number 2 sounds almost ominous doesn’t it? Most of the mistakes made by landlords are related to tenants becoming non-paying tenants. If you depend on this rental income to help offset on the mortgage, then frustrations can run very high. However, what you must understand is there are laws to be followed and steps to be taken. Believe it or not, as a landlord you are protected, and more so today than in the past.
So what exactly constitutes “revenge”?
Well, for one turning off the utilities. Or changing the locks, or deciding to take justice into your own hands with the help of, shall we say, “acquaintances”? Or even entering the property under the ruse of a routine check can land you in hot water with the Spanish police.
The only – legal – way to evict your tenant is to hire a lawyer and initiate a formal eviction procedure through the Spanish law courts. New laws have been enacted to help speed-up the eviction procedure. But on average it is still taking 5-9 months depending on how clogged local law courts are. Don’t despair! This process used to take years in Spain!
#3 – The contractual “watertight” myth
For whatever reason, many landlords think that an eleven month contract means “short term” and “watertight”. Sorry to burst your balloon, but it really doesn’t. This is another huge mistake on the part of landlords and rather costly if not done correctly. Many will assume because the rental agreement is classified as a short or long-term rental it’s really that cut and dry. Unfortunately not – what matters is the tenants are not using the property as their main residence and this must be clearly written into the Tenancy Agreement, so it is in fact classified as a short-term rental.
Tenants have successfully challenged in court, a short-term 11-month contract into a long-term contract lasting up to 5 years. This means during the next 5 years you will not be able to recover any possessions on the property while it is being rented. Thankfully, the new Express Eviction Law has now amended most of this and allows landlords to introduce those very important written clauses into the contracts.
Avoid the pitfalls of renting your property in Marbella
Only a few years ago, Spain’s rental laws didn’t do much in way of protecting landlords and seemed to sway only towards protecting the tenants. Thankfully, both parties seem to be equally protected to at least a certain extent today. Regardless of the argument of who has better odds, the fact remains that owning a rental property in Marbella today can potentially be a sound investment. Basically, you can take full advantage of the bustling and booming tourism in Marbella.
Of course, as always the best advice we can give to both landlords and tenants is to seek legal advice on renting property, and prior to making any impulsive decisions related to non-payment of rent. At Location Moves, we are here to help in any way we can, and to point you in the right direction should any problems arise. We also have a large selection of rental properties near Marbella.