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RENTING IN SPAIN

What is Spain’s rental allowance fund and how can I claim it?

The Spanish government offers rental help for low and medium income earners aged between 18-35, but what is the 'bono' rental fund and how can you claim it?

What is Spain's rental allowance fund and how can I claim it?
Young people in Spain can apply for a rent bonus in 2022. (Photo by GABRIEL BOUYS / AFP)

As The Local reported last year, the Spanish government has created a ‘Bono Joven Alquiler’ (Youth Rental Bonus) to help young people with the rising cost of living and rental prices.

With inflation causing prices and rents to skyrocket in recent months, young people across Spain (both Spanish and foreign residents, more on that below) will be relieved to know that the money from the fund is now becoming available to claim, depending on where in Spain you are.

READ ALSO: Soaring energy prices push inflation in Spain up to 37-year high

The Local breaks down who’s eligible, for how much, and how to claim below:

‘El bono’

Back in January, Pedro Sánchez’s PSOE-led coalition government approved the Royal Decree 42/2022, which created the ‘Bono Joven Alquiler’ as part of a broader plan to increase access to housing between 2022-2025.

The ‘bono’ has a budget of €200 million set aside, and it is believed that over 70,000 young people will be able to claim up to €250 a month for a period of two years to help pay their rent.

READ ALSO: Spain to give young mid-income earners €250 monthly rental allowance

The fund has been welcomed by young Spaniards as the rental market in Spain places youngsters under particular pressure. According to a survey by Spanish property engine Fotocasa, 62 per cent of under 35s in Spain face financial obstacles when buying or renting a property.

And this forces them to stay at home longer, too: the average Spaniard leaves the nest at 29.5 years of age, the sixth latest bloomers in Europe, where the average age of emancipation is 26.2 years old.

So, what help is the government offering, and what are the terms?

How old do you have to be to claim?

Spaniards seem to be quite liberal with their understanding of ‘young’. You must be between 18 and 35 years of age to qualify for the bono support.

How much can you claim?

Each applicant is entitled to €6000 over two years, split into 24 monthly payments of €250.

Who’s eligible to claim?

In order to claim, you must satisfy a few basic criteria:

  • Be a Spanish or European citizen or a third-country citizen with legal residency in Spain.
  • The rental allowance must be used to pay rent, and nothing else.
  • The maximum price of the rented property must not exceed €600, or €300 for a room. There are some exceptions, where total rents may be higher in some cases, depending on where you are, up to €900 or €450 per room. 
  • Your annual income must not be more than three times the value of the IPREM (‘Public Multiple Effects Income Indicator’ or Indicador Público de Renta de Efectos Múltiples, in Spanish) which is currently set at €24,318.84.
  • However, according to the official government website, the IPREM calculation varies depending on your situation and family size: although it is three times the IPREM in general, it can be four times the IPREM for large families and people with disabilities, and five times for ‘special large families’ and people with more serious disabilities.
  • All rents, whether for an entire property or private room, must be supported by a rental contract for the purposes of the application.

How can I claim?

Despite being a flagship policy of the coalition government, the administrative process is delegated to the autonomous communities. As is often the case in Spain, each regional government has a slightly different process, but the first to open up applications for the fund are Catalonia and Valencia.

If you are based in Catalonia, and meet all of the criteria above, you can access the application portal of the Generalitat here, and for the Valencian Community on its housing aid website here.

READ ALSO: Rent prices in Spain rising 30 times faster than wages

It is believed that some autonomous communities will retroactively cover rent payments dating back to January 2022, although it is suggested that you contact your region’s individual housing authority for more information.

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For members

RENTING IN SPAIN

How to rent a property in Spain without a job contract

When looking to rent in Spain, property owners and estate agents often ask for a 'nómina' and work contract - something that can prove tricky if you're self-employed or not working. Here's how to prove your solvency and secure the rental.

How to rent a property in Spain without a job contract

If you’re looking for a house or apartment to rent in Spain, there can be a multitude of different factors to consider.

The price, the size, the location, the neighbourhood, which floor the flat is, on and whether there’s a lift, whether it’s interior or exterior, how many apartments there are per floor, whether to go private or through an estate agents and, of course, the search itself.

When you’re going on visits, you’ll have to contend not only with owner or agent trying to ‘sell you’ the place, but also explaining the terms and conditions (often referred to as las condiciones or requisitos para entrar).

In Spain, the process can be a little complicated. Often landlords ask for two months deposit upfront, and those that go through an intermediary estate agent tend to ask for two months, plus an extra month (plus VAT, or IVA as it is in Spain) that goes to the agent! It certainly adds up. 

Not only that, but very often in Spain you are expected to prove you will be able to pay your rent every month. And it’s not as simple as you might think. 

Most estate agents or landlords think hat the best way to ascertain this is by you providing proof of an employment contract (contrato laboral) and recent payslips (la nómina) that demonstrate you are paid the same amount every month, and that it’s enough to cover the rent and other expenses.

Here’s where things can start to get tricky for self-employed people (known as autónomos in Spain), who number more than 3 million in Spain.

Regardless of whether your monthly autónomo earnings are high pretty much every month, regardless of how consistent they may be, or even if you have regular clients, the irregular and insecure nature of Spain’s work market have ensured that landlords and realtors take a rigid attitude towards the rules.

This is especially true following the turbulent economic times of recent years as we’ve moved from global pandemic to war in Europe to spiralling inflationary pressures on the global economy.

Landlords want to be sure you can pay the rent. Therefore, they may favour a waiter with a nómina of €1,000 a month over an autónomo who can prove monthly earnings double that for the previous six months. Doesn’t seem fair, right? 

READ MORE: Why you should be raising your rates if you’re self-employed in Spain

Well, that’s often how it can be in Spain. Fortunately, if you find yourself in this situation, there are various ways you can convince potential landlords that you are financially solvent enough to rent their property, with or without a fixed contract

The law

Now, it is not unheard of – in Spain nor anywhere else in the world – for an estate agent or landlord to try and squeeze more money out of you, or to add on some extra charges. In most people’s experience, Spanish estate agents and landlords are no better or worse than anyone else, but it’s worth keeping in mind.

It has been known, however, for some in Spain to try and get an extra month’s deposit by telling potential tenants that they need a nómina by law in order to rent a property in Spain, and that they’re doing you a favour by allowing it.

Simply put, this is not true. According to Spanish law, more specifically, La Ley de Arrendamientos Urbanos (Urban Renting Law), although many landlords require some form of financial insurance, there is absolutely nothing to say a nómina is necessary to rent a property in Spain. A deposit is legally required, but a nómina?

Helpful? Certainly. Legally necessary? Definitely not.

That said, if you explain to the property owner that you’re self-employed, some landlords maybe be willing to make other arrangements to ensure the rent.

Here are some options, and other bits of paperwork that could help:

Aval bancario: Like a bank guarantee, some landlords request tenants without nóminas or work contracts to set up an aval bancario.

You must pay in an agreed amount (often worth the value of two or three months of rent, sometimes more) into a bank account that you’re a customer with.

It’s money that you cannot touch for an agreed period of time and which you pay some interest on, and in the event that you do not pay your rent, the landlord will be able to access said funds.

This is not the cheapest way to rent a property, but it may be one of the more effective ways of convincing a landlord to accept you as a tenant.

If you pay your rent diligently every month and prove that you are reliable, after a year you should speak to your landlord to ask them them to cancel the aval in order to not continue paying interest on it and recover your stored money.

Anuncios de particulares: If you’re using the usual rental search engines like Idealista or Fotocasa, the vast majority of rental adverts are from estate agents (inmobiliarias) who ask for all the proper documentation, including contracts and pay slips, and often the extra month’s rent as a fee.

When you’re making your search, keen an eye out for anuncios particulares , which are private ads direct from landlords.

Sometimes if you deal directly with the owner themselves, they are less strict about rules with regards to nóminas and contracts. Maybe you’ll get really lucky and find a landlord that takes a liking to you and who only asks for one month’s deposit.

Seguro de impago de alquiler: A landlord may be more likely to rent to you even if you don’t have a nómina when they have seguro de impago de alquiler, non-payment rental insurance. It protects the landlord for the duration of the contract and covers the rent and any repairs or legal fees.

IRPF: IRPF is Spain’s personal income tax, and providing your most recent income tax return could help put your potential landlord at ease by proving that what you’ve earned over the last year could cover the cost of the rent.

Seguridad Social: Similarly, providing proof of your social security payment can help prove your financial solvency.

Bank statement: a simple bank statement to show account activity – and that you have enough to pay the rent and deposit, of course – might ease the mind of your landlord as it allows them to see your incomings and any debts you might have.

IVA: Showing your VAT (IVA in Spain) returns could be another tool that, when used in conjunction with other ways of proving your solvency, could convince a landlord to rent to an autónomo.

Pensioner documentation: If you’re retired and you’re looking to rent, any official documents which show how much pension money you receive every month, along with bank statement reflecting savings, should suffice to convince a landlord or estate agent that you’re solvent.

READ ALSO: Renting in Spain: Can my landlord put up my rent due to rising inflation?

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