Canary Islands: Residential Lease Penalties & Duration

Leasing a property in the Canary Islands archipelago as a "Primary Residence" (Vivienda Habitual) subjects the landlord to the mandatory protections of the Spanish Urban Leases Act (LAU 29/1994), which came into effect on 1 January 1995. Any attempt to limit these rights through abusive clauses will result in their absolute nullity in the Juzgados de Primera Instancia of Las Palmas or Santa Cruz de Tenerife.

1. Mandatory Extensions for the Landlord (5 and 7 Years)

Regardless of the landlord's preference, a tenant residing in a primary residence in the Canary Islands is guaranteed the right to remain in the property:

• It does not matter if you draft an "11-month" contract; if the property is the tenant's habitual and permanent home, the law treats it as a long-term residential lease.
• The LAU imposes mandatory annual extensions for the landlord until reaching a legal minimum of 5 YEARS (or 7 years if the landlord is a legal entity). If the agreed term is shorter, the contract is automatically extended annually until these limits are reached (Art. 9 LAU).
• Tacit Renewal (Art. 10.1 LAU): After the initial 5 or 7 years, if neither the landlord (with 4 months' notice) nor the tenant (with 2 months' notice) expresses a desire to terminate, the contract is extended by annual periods for up to a maximum of 3 additional years.

Extraordinary Extensions (Ley 12/2023)

Under the Housing Law, additional mandatory extensions may apply:

• Vulnerability (Art. 10.2): Tenants in a situation of social or economic vulnerability may request a mandatory 1-year extension.
• Stressed Zones (Art. 10.3): In municipalities declared as 'Stressed Market Zones' (Zonas de Mercado Residencial Tensionado), tenants may request an extraordinary extension for annual periods up to a maximum of 3 years. The landlord must accept this unless they require the property for personal use under the conditions of Art. 9.3.

2. Premature Exit and the Right to Withdraw

Under the law, a tenant in the Canary Islands has the right to leave the property and terminate the contract prematurely:

• They have the right to withdraw once the first six (6) months of the contract have passed (Art. 11 LAU).

• They must inform the landlord with at least 30 days' notice via Burofax or other reliable communication.

• Withdrawal Penalty: If the tenant leaves after the 6-month mark, the landlord can only charge an indemnity if it was explicitly agreed upon in writing in the contract. By law, this maximum indemnity is capped at one month's rent for each remaining year of the contract (pro-rated for periods shorter than a year).

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