On May 26, 2023, Law 12/2023 on the Right to Housing came into effect, allowing the Administration to establish areas of stressed residential markets where rent control measures can be applied to lease agreements. So far, only Catalunya has declared such areas through Resolution TER/800/2024, affecting 140 municipalities.
The law differentiates the determination of rent based on whether the landlord is considered a large property owner or not.
- Lease contract where the owner is a LARGE PROPERTY OWNER:
-If the property is in a municipality included in the declaration of a stressed residential area:
The agreed rent may not exceed the higher of the following amounts:
- The last rent of the previous lease agreement that was in force in the last five years.
- The maximum limit of the reference price index determined by the Ministry of Housing.
-If the property is NOT located in a municipality included in the declaration of a stressed residential area:
The rent will be freely agreed upon by the parties.
- Lease contract where the owner is NOT a large property owner:
-If the property is in a municipality included in the declaration of a stressed residential area:
The agreed rent may not exceed the higher of the following amounts:
- The last rent of the previous lease agreement that was in force in the last five years.
- Only if there is no previous lease agreement, it may not exceed the maximum limit of the reference price index determined by the Ministry of Housing.
-If the property is NOT located in a municipality included in the declaration of a stressed residential area:
The rent will be freely agreed upon by the parties.
Thus, the Law stipulates that when the property is in a stressed residential market area, this circumstance must be indicated in the lease agreement, along with the following data:
- The amount of the last rent of the previous habitual residence lease agreement that was in force in the last five years for the same property.
- The value corresponding to the reference rental price index for housing.
Besides rent control, the new housing law has also introduced changes regarding contract extensions and tax incentives applicable to IRPF.
In view of the above, let us examine how the Law defines the figure of a large property owner:
NATIONAL REGULATIONS: Article 3.k) of Law 12/2023, of May 24, on the Right to Housing states that:
<<For the purposes established in this law, a natural or legal person who owns more than ten urban residential properties or a built area of more than 1,500 m2 of residential use, excluding garages and storage rooms. This definition may be particularized in the declaration of stressed residential market areas to those owners of five or more urban residential properties located in that area, as justified by the autonomous community in the corresponding explanatory report>>.
REGIONAL REGULATIONS: In compliance with Article 3.k) of Law 12/2023, the Department of Territory of the Generalitat of Catalunya approved Resolution TER/800/2024, modifying Resolution TER/2940/2023 to declare several municipalities as stressed residential market areas, in accordance with the state Law 12/2023. This resolution also defines a large property owner as established in Article 3.k) of the abovementioned law:
<<Also, a natural or legal person who owns five or more urban residential properties located within the previously declared stressed residential market area>>.
In Catalunya, a large property owner is considered to be one who owns five or more urban residential properties in the 140 municipalities declared as stressed residential market areas: or more than ten urban properties, or a built area of more than 1,500 m2 of residential use, whether within the stressed area or not.
The law does not clarify aspects such as the calculation of co-owned properties, different forms of ownership, or the inclusion of property communities, requiring reference to case law and doctrine to complete the definition.
At addwill, we can help you resolve all your doubts. Do you want to know if your lease agreement is affected by the Housing Law? Are you a large property owner? Do you have questions about your rights and obligations? Do not hesitate to contact us at phone number 34 934 875 200, email comunicacio@addwill.eu, or by clicking here.