A big advantage in renting out your Spanish property is that it can offer you the freedom to move during a time when selling a property in Spain has become decidedly more difficult. It affords you the option to rent another property elsewhere and also, the option to buy another property without having to sell up.
If you are considering renting out your property in Spain, then you need to consider the pros and cons to becoming a landlord. Click here to list your rental property on Thesaraservice.com.
Should I rent privately or via an agent?
First and foremost you need to decide whether or not you are going to use a rental agent to rent your property in Spain or whether you are going to rent your Spanish property using private channels. Obviously the main advantage to letting out your property privately is that you will initially save on costs by not having to pay a commission to the agent for finding your tenants. It is worth bearing in mind however, that if you don’t manage to rent the property promptly, then you are missing out on as many months in rental income, in which case a month’s rent as commission (a standard commission for an 11 month rental in Spain) for a quick rental and your peace of mind seems a lot more attractive and much less costly...
Clearly one of the biggest advantages of using a rental agent to rent your property in Spain is that there will be much greater exposure of your property to potential clients, so you are much more likely to rent your property quickly as well as saving your precious time by letting the agent organise viewings, vet clients, obtain work/bank/previous landlord references and also by drawing up a legal tenancy agreement for yourself and your new tenants.
If you would prefer to take a complete back seat in the process most agents will also offer a complete management service during the tenancy period, in which they will liaise directly with the tenant, taking care of maintenance issues, rent payments, electric bills etc etc. This is a very welcomed option for those who are going to be out of the country and/or for those who don’t speak Spanish and have experienced the difficulties faced by that language barrier. A complete management service obviously comes at a charge, and as well as the level of service, the price can vary from agent to agent, but you can expect to pay anything from 5-15% of the monthly rent.
How much should I fix my rent at?
If you want to rent your property quickly, it is imperative that you set the price right, for the location, size and quality of your property. Your rental agent will have a good understanding of the market and will be able to give you advice as to the amount of rent you can expect to receive. It is a good idea to have a look at similar properties in the area and see what they are charging to get a good comparison.
It is important to remember that most potential tenants will try to negotiate a better offer, so if you have to get a certain amount to cover your mortgage re-payments, then you need to be careful and consider this when setting your price. On the same token, it is important to listen to your rental agents advice, because if you set the rent too high, it is highly unlikely that you will rent it and before you know it you have missed out on two or three whole month’s rent because you were holding out for an extra 100 Euros a month.
When renting out your property in Spain, it is a good idea to have something behind you financially, in order to cover the periods between tenants when your property is empty. Some landlords get lucky and have a tenant for years whereas, sometimes circumstances can mean a tenant has to move out 6 months into a contract. You need to make sure you can cover your own back by making sure you have enough capital during these empty periods to cover the rental/mortgage costs where you yourself are now living as well as for the property you are trying to rent out. Then you also need to consider that you will need to cover the cost of any maintenance that needs doing to the property.
Cover against damage – The rental deposit
The rental deposit (one or two months’ rent) is usually held by the landlord or the rental agent and should be returned promptly to the tenant in a timely fashion providing the tenant has given proper notice and there was no damage to the property or outstanding bills. Any damage caused by the tenants that has not been caused by everyday wear and tear will need to be replaced and the total cost deducted from the deposit. The same goes for any outstanding bills.
The law in Spain states that the rental deposit should be held by the Junta de Andalucía, but this is rarely adhered to since it can be as difficult to get the deposit back from them as it is unscrupulous landlords.