Pedro Pizá Nerín
Partner, Kreston Iberaudit, Spain
Property owner rights in Spain: Can communities ban vacation rentals?
December 3, 2024
A new ruling by the Spanish Supreme Court has raised some questions about property owner rights in Spain. Vacation rentals have become a booming trend, offering property owners a way to cash in on tourism while giving travellers a more affordable, flexible alternative to hotels. But this rising phenomenon has also sparked tensions in residential communities, where neighbours often see short-term rentals as disruptive to their peace and privacy.
The Spanish Supreme Court recently weighed in on this growing debate with a significant ruling. The question at the centre of the case: Can a community of property owners stop one of its members from using their property as a vacation rental? Pedro Pizá Nerín, Partner at Kreston Iberaudit, Spain, discusses the potential impact on property investors in Spain.
Changes to property ownership rights in Spain
Owning a home typically comes with broad rights—you can live in it, sell it, or rent it out. But when you live in a shared residential building or community, your neighbours’ interests also come into play. Vacation rentals, while profitable for the owner, often disrupt the quiet and stability of residential life. These rentals bring in a steady stream of tourists, who may not share the same respect for community norms as full-time residents.
The Supreme Court’s ruling acknowledges this tension. It highlights the need to balance individual property rights with the collective interest of maintaining a peaceful, residential atmosphere in shared communities.
Court rules vacation rentals are commercial activity
One of the key arguments in the case was the nature of vacation rentals. The Court made it clear that renting out a property to tourists is not the same as simply renting it to a long-term tenant. Vacation rentals are temporary by nature, catering to short-term stays, much like hotels. This lack of permanence, combined with the fact that properties are marketed for profit through tourism platforms, means they are better categorized as a commercial activity.
For communities made up of residential properties, this distinction is crucial. Residents in these communities expect stability and quiet—a lifestyle that frequent turnover of guests can disrupt
How communities can regulate vacation rentals
The Supreme Court’s decision also clarified how communities can take action against vacation rentals. While homeowners have significant rights, they’re not unlimited. Communities can impose rules to restrict or even ban short-term rentals, but there are conditions:
Clear Rules: Any restrictions must be explicitly written into the community’s governing rules, leaving no room for ambiguity.
Fair Approval: These rules must be approved by a significant majority of the community’s members—not necessarily everyone, but enough to show widespread agreement.
The ruling also emphasized that such bans aren’t automatic. Communities need to follow the correct procedures to ensure their decisions hold up in court.
What this means for Spanish property owners
The Court’s decision gives communities more power to protect their residential character. If most residents feel that vacation rentals are disruptive, they now have a clearer path to impose restrictions. However, the ruling also serves as a reminder to follow proper procedures when setting these rules. Communities that skip steps or act hastily could see their decisions overturned.
For property owners looking to make money from vacation rentals, this ruling adds a layer of caution. Renting out your home to tourists might not always be an option, especially in buildings or neighborhoods where residents want to keep things strictly residential.
The future of Spanish vacation rentals
This ruling reflects the growing tensions caused by the rise of vacation rentals. On one hand, they represent a thriving business model that benefits property owners and the tourism industry. On the other, they challenge the harmony of shared residential spaces.
As this debate continues, the Supreme Court has made one thing clear: communities have the right to draw the line and protect their way of life—if they do it the right way.
