10 Things to know before renting a property in Madrid
There are several important things many freshly arrived expats do not know when renting a property in Madrid. Here is a list of the 10 things you should know before you start shopping for an apartment in Madrid.
1. Rent usually includes taxes but not utility bills
Utilities are typically not included in rent- this includes water. To get an idea of how much this will cost, you can read how much you might spend on utilities. Community charges and taxes are usually included, unless specified otherwise. Refuse to pay any additional new taxes the Madrid government creates if they are not on the initial contract.
2. The minimum legal duration of rental contracts is 6 months, but most landlords ask for 12 months
Most landlords request a minimum contract duration of one year, but short-term contracts can be found. You should also know that short term rentals (anything less than a year) do not give tenants nearly as many rights as long term rentals. In fact, in the past landlords used to try to get tenants to sign eleven month contracts to give themselves maximum protection. However, those days are over. Even if you have signed an eleven month contract, the courts will consider that a long-term contract if you have been living in the place daily, you have engaged wifi/telephone services, etc.
If you need a shorter contract, you will probably have to go to work with a company that manages short-term apartment rentals. This will increase the monthly rental by 20-50%, compared to yearly ones.
3. Realtors working for landlords may charge you
Classic real estate agencies work to help landlords find tenants. However, although the services are for the landlord, many bill these services to the tenant. They range from 100€ to one month’s rent. Yes, you heard it – they do nothing for you, but they do charge you. That is because there is a lack of quality rental apartments in Madrid and agencies leverage this as much as possible.
This is slowly changing. Therefore, some apartments will have agency fees (either because it’s rented directly by the landlord directly or because the agency does not charge the tenant), and some won’t.
To compare apartments, we don’t recommend avoiding all apartments with agency fees (agents often have the best properties), but rather bench-marking the different apartments and including the agency fees in the rental price. For instance: suppose you found an apartment that costs 1000€ per month, with an agency fee of one month’s rent. If you assume you will be staying in the apartment for 20 months, add 5% to the rental price to benchmark it to an apartment of comparable quality that costs 1100€ per month, without an agency fee. 1000€ + 5% is equivalent to 1050€ a month, so it is still a better deal to rent the 1000€ per month property and pay the agency fee.
Note: real estate agents are different than relocation and property search companies who search for you and are on your side. These type of companies conduct your search and help you renting a property in Madrid. They legitimately charge you for their services when they have ensured you are settled and satisfied.
4. Think about the noise level at night
If your apartment is somewhere in the city center, you should make sure the noise level is acceptable. Before renting a property in Madrid, come back at night to make sure the flat you want to rent is not on one of the major party streets. Some of the busiest streets at night in the party neighborhood of Malasaña look very calm during the day.
Even if you are not looking in a party neighborhood, after hours nightclubs are sprinkled throughout Madrid neighborhoods. Check the block for businesses that are shuttered during the day (and early evening hours) and research them on the the internet before you sign the lease.
5. Depending on the flat, you may or may not need A/C
You might or might not need A/C. If you rent an exterior apartment facing south, you need air conditioning. Madrid temperatures can reach 40ºC, but some people can live without A/C if their apartment is not too exposed and/or they are used to high temperatures. The best is to ask former tenants or neighbors about their experience during the summer.
6. “Exterior” usually means better views and more light
“Exterior” means your apartment has windows on the outside of the building. Many apartments only have windows facing the interior courtyard. They can be really beautiful- it depends on your tastes and on the specific design of the flat.
7. Security deposits can vary
Legally, landlords are only permitted to ask for a one month deposit on rental contracts greater than one year. If you are renting a furnished property in Madrid, or the contract is for less than a year, landlords are permitted to ask for a security deposit equivalent to two months rent.
However, many ask for more- some up to six months. On average, for top quality apartments, expect to pay a security deposit equivalent to three months rent. Professionals can help you negotiate it down.
8. On top of the deposit, some landlords ask for a bank guarantee
On top of the deposit, your landlord may ask for additional aval bancario or bank guarantee. For example, they may ask for six months rent to be deposited into a Spanish bank. If you choose to do this, expect to pay about 1% a month in bank fees. If you have issues paying rent, the landlord will have the right to take money directly out of this account.
9. Who pays for maintenance?
The landlord is obligated, at all times, to maintain the property in a habitable condition.
However, the tenant is responsible for repairing any damage they cause to the apartment. This includes regular wear and tear. If the tenant doesn’t make these repairs, the landlord can do so at the tenant’s expense.
10. Get a pro to check your contract before renting a property in Madrid
Get your contract translated, read it carefully and clarify every ambiguous point with your potential landlord. Make sure to review the inventory (if you are renting a furnished apartment). Detail, in writing, any and all damage you see in the flat. Take photos and send an updated version of the inventory to the landlord.
We recommend reading our guide to rental contracts in Spain. It will help you do a thorough review of your contract. If you need further assistance, book a FREE CONSULTATION TODAY to chat with Imagine Global, our rental partner.