Documentation, EPC and Required Advertisements in the Balearics

Under the framework of the Spanish Urban Leases Act (Ley 29/1994), which came into effect on 1 January 1995, and the recent Right to Housing Law (Ley 12/2023), landlords in the Balearic Islands are subject to strict transparency and documentation requirements. Whether advertising a property in Mallorca, Menorca, or Ibiza, specific certificates and disclosures must be provided to prospective tenants before any commitment is made.

1. Obligation of the Energy Performance Certificate (EPC)

Regulated by Royal Decree 390/2021 (effective 3 June 2021) and the LAU, every property owner in the Balearics intending to rent their property must obtain an Energy Performance Certificate (Certificado de Eficiencia Energética).

• Mandatory Advertising: Every rental advertisement published on portals or by agencies must include the energy efficiency label (rating from A to G).
• "In Process" Prohibited: It is illegal to advertise a property stating the EPC is "in process." The Balearic Directorate of Energy may impose sanctions ranging from €300 to €6,000 for lack of certification or improper advertising.
• Material Delivery: A copy of the EPC must be physically delivered to the tenant and attached as an annex to the lease agreement upon signing.

2. Mandatory Disclosures under the Housing Law (Transparency)

The Law 12/2023 (effective 26 May 2023) introduced enhanced transparency requirements. Landlords or their representatives must provide the following information to any prospective tenant who requests it during a visit:

1. Economic Breakdown: Clear differentiation between the base rent and any additional costs (community fees, rubbish collection tax, or IBI) that will be passed on to the tenant.
2. Ownership Status: Clarification of whether the person renting the property is the owner, a usufructuary, or an authorized representative.
3. Habitability Certificate: Verification of the Cédula de Habitabilidad (Habitability Certificate) or the License of First Occupation, which confirms the property meets regional housing standards.
4. Property Details: Accurate information regarding the age of the building, the useful square meters (metraje útil), and the cadastral reference.

3. Agency Fees and Commissions

Following the implementation of the Housing Law 12/2023 (amending Article 20.1 of the LAU), the allocation of real estate agency fees for residential leases has changed:

For all leases intended for permanent habitual housing (vivienda habitual), the landlord (owner) is strictly responsible for paying the real estate intermediation fees and the cost of formalizing the contract. Agencies are prohibited from charging these costs to the tenant in long-term residential rentals.

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