What is the LAU and why three regimes?
The LAU (Law 29/1994) governs urban rentals in Spain and distinguishes three regimes: primary residence (art. 2), rental "for use other than dwelling" (art. 3), and tourist-use rental (art. 5). Each has different rules, durations, protections and tax obligations.
The original 1994 LAU has been reformed in 1995, 2013, 2019 and most recently in 2023 with the Right to Housing Law. The 2013 reform was the most relevant for vacation rental: art. 5 letter e) was introduced expressly excluding tourist rental from the LAU and referring it to autonomous-community regulation.
In practice, legal conflicts for hosts almost always arise from the boundary between art. 3 and art. 5: is a 4-month stay for work reasons a seasonal rental (art. 3) or a disguised tourist rental (art. 5)? The correct answer changes the minimum contract duration, tenant rights and owner obligations.
The three regimes: practical comparison
The difference is purpose (live / work / tourist), duration (years / months / days), and applicable rule (LAU / LAU + regional / regional only). This table is the quick reference.
| Aspect | Art. 2 (primary residence) | Art. 3 (seasonal) | Art. 5 (tourist) |
|---|---|---|---|
| Purpose | Living habitually and permanently | Temporary stay with identifiable motive (study, work, health) | Tourist use — vacation, leisure |
| Typical duration | 5 years (mandatory extension), 7 if landlord is a legal entity | Commonly 11 months; reasonable max one year | Days, weeks or few months |
| Mandatory extension | Yes, up to legal limit | No, expires on agreed date | Not applicable — LAU does not apply |
| Tourist license | Not required | Not required | Mandatory (VV / VFT / VTAR per region) |
| Housing register entry | Voluntary | Voluntary | Mandatory in regions with tourist register |
| SES.Hospedajes | No (exempt under LAU art. 2) | Debatable — verifiable | Mandatory within 24 hours |
| Applicable rule | LAU integral | LAU art. 3 + supplementary civil law | Regional tourism regulation |
| Deposit | 1 month mandatory | 2 months typical | Not regulated by LAU |
The 11-month contract: legal trick or trap?
Not a "trick" per se — it's a legitimate application of art. 3 LAU. But using 11 months to mask actual tourist rental (by-day) or to evade habitual-tenant protection is illegal and courts reclassify it regularly.
Art. 3 LAU allows rentals "for use other than dwelling" when the primary purpose is NOT to satisfy the tenant's permanent housing need. The 11-month contract is typical because it fits an academic, work or health season — but the seasonal character is a fact, not a label.
Supreme Court doctrine (including STS 20/03/2018) is clear: the judge analyses economic reality, not paper. A tenant who signs 11 months but lives with their partner and child and works in the rented city is in disguised primary-residence rental, and the contract reclassifies to art. 2 with all protections (5-year extension, prohibition of arbitrary CPI increase, etc.).
When does the tourist regime (art. 5) apply?
When the property is offered on tourism platforms, promoted for vacation use, or includes typical hotel services (cleaning, sheets, 24h reception). Short duration alone is NOT a determining criterion.
Art. 5 LAU excludes from LAU scope "the temporary transfer of use of a fully-furnished and equipped dwelling in ready-to-use condition, marketed or promoted through tourism channels or by any other form of marketing or promotion, carried out for profit, when subject to a specific regime derived from tourism sectoral regulation".
Three criteria must coexist: furnished ready-to-use dwelling, tourist marketing (Airbnb, Booking, own website with "book" section), and subjection to autonomous-community vacation-rental regulation. Duration is not a criterion: a property listed on Airbnb with 30-night minimum is tourist by channel, even if the stay is long.
- Listing on Airbnb / Booking / VRBO / similar: determining criterion for tourist use.
- Own website with booking system and per-night price: determining criterion.
- Hotel services (mid-stay cleaning, towel change, reception): reinforce tourist qualification.
- Furnished dwelling ready for immediate use without tenant registration formality: strong indicator.
- Per-night and not per-month payment: typical indicator.
Tensioned zones: the Law 12/2023 novelty
Law 12/2023 introduced the concept of "tensioned residential market zone". In those zones, LAU art. 2 contracts are subject to CPI ceiling and, for large landlords, to a price index. Regions declare zones; Catalonia was first.
For hosts who are not large landlords, the only practical novelty is the limit on annual rent increase on LAU art. 2 renewals. For large landlords, the tensioned zone additionally imposes a cap on new rents under the state index. Law 12/2023 art. 3.k defines a large landlord as a holder of more than 10 urban residential properties (or >1,500 m² built); that threshold can be lowered to 5+ properties only within a specific tensioned zone where the autonomous community expressly motivates it in its declaration.
Art. 3 (seasonal) and art. 5 (tourist) are NOT affected by tensioned zones — they are separate figures. But if Catalonia or Madrid extend the concept to seasonal rental (as debated in 2025-2026), the situation will change. Monitor BOE and BOIB/DOG for amendments.
What should a well-drafted LAU contract contain?
Party identification, property description with cadastral reference, express purpose (art. 2 / 3 / 5), duration, rent and payment terms, deposit, costs, jurisdiction clause and signature. For art. 3, justify the temporary purpose within the contract itself.
- Landlord and tenant identification with NIE/DNI/passport.
- Full property address + cadastral reference (mandatory in the fianza deposit registration with the regional authority since RDL 7/2019; strongly recommended in the contract itself).
- Express citation of applicable LAU regime: "under art. 2 / 3 / 5 LAU".
- For art. 3: verifiable temporary motive (employment contract with end date, university enrollment, etc.).
- Duration with start and end date, and tacit-renewal clause (where applicable).
- Monthly rent + payment method + bank account.
- Deposit: amount, deposit at regional authority (INCASOL in CAT, IBAVI in Balears, etc.).
- Cost distribution: community fees, IBI, utilities, waste.
- Jurisdiction and applicable law clause (always Spanish law).
- Handwritten or advanced electronic signature.
Risks of mis-classification
Misclassifying a contract can be judicially reclassified and expose you to: forced 5-year extensions (if it was disguised art. 2), regional penalties for lacking tourist license (if it was disguised art. 5), and transfer tax for improper use.
Economic risk depends on the direction of error. Sign art. 3 (11 months) and the tenant demands reclassification to art. 2, you're stuck with a 5-year mandatory contract you didn't want. Sign art. 3 and the regional administration detects you operate tourism-style, you receive sanctions for lacking tourist license (in Catalonia, up to €600,000 per listing without HUT; in the Valencia Region, up to €600,000 since Decret-ley 9/2024).
Administrative verification is cross-referenced: SES.Hospedajes, platform registers (Airbnb / Booking submit data under RD 933), municipal inspectors in saturated zones. Opacity is no longer a viable strategy.
Frequently asked questions
Can I combine art. 3 and art. 5 in the same property?
If the tenant stays beyond the end of the art. 3 contract, what happens?
Is the deposit for art. 3 one month or two?
Do I need to declare IRPF / IRNR for an art. 3 rental?
How do I prove the "temporary purpose" of art. 3 during inspection?
Sources
- Ley 29/1994 LAU Ley 29/1994, de 24 de noviembre, de Arrendamientos Urbanos (BOE-A-1994-26003) — texto consolidado
- Ley 12/2023 Ley 12/2023, de 24 de mayo, por el derecho a la vivienda (BOE-A-2023-12203)
- RDL 7/2019 Real Decreto-ley 7/2019, de 1 de marzo, de medidas urgentes en materia de vivienda y alquiler (BOE-A-2019-3108)