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POPULATION

Spain struggles to repopulate its deserted rural interior

Sarnago lost its last resident 37 years ago but Jose Maria Carrascosa and his association are trying hard to revive the village, an uphill battle in one of Spain's most depopulated regions.

Spain struggles to repopulate its deserted rural interior
All photos by Cesar Manso / AFP

A rural exodus, which began in the 1950s as people moved to find work in factories, has left some parts of Spain with just two people per square kilometre — the same density as in Siberia.

This is the case in parts of Castile, a vast region in central Spain where Sarnago is located, in the northern Aragon region and the southern provinces of Extremadura.

It makes Spain a “strange country within Europe” since no other similarly sized nation on the continent has such demographic deserts, Spanish writer Sergio del Molino wrote in his travel book “La Espana Vacia” (“Empty Spain”), published last year.

“The depopulation here was brutal,” said Jesus Hernandez, the mayor of San Pedro Manrique, a larger town of around 600 residents near Sarnago.   

The emigration from the region was especially fuelled by a decision in 1965 while Spain was in the grips of the dictatorship of Francisco Franco to plant 22,000 hectares (54,000 acres) of pine trees to feed the paper industry, which pushed out cereal farming.

Two years later, Carrascosa's father moved his family to Tudela, a town further east in the fertile Ebro Valley.

Not forgotten

But wind-swept Sarnago, which at one point was home to about 400 people including 30 children, has not been forgotten by its former residents, who have restored 25 of its 40 houses and now have running water and access to electricity.

Carrascosa, who heads an association that seeks to reverse the village's fortunes, is proud of his three-bedroom home in Sarnago, which he visits regularly for short stays.

Through meetings, a magazine and social media, he encourages other former residents to maintain a link with the village too.   

The restoration of homes, though, has still not led to any permanent residents, mainly due to lack of public services in the village, located some 200 kilometres (135 miles) northeast of Madrid.

The nearest public health centre is four km away in San Pedro Manrique but offers only basic medical care.

There is a primary school there as well, with 66 children, but no high school.

Jesus Catalan, a 71-year-old pensioner, and his wife live in Sarnago from March to October but leave in winter when temperatures can drop to minus 15 C.

“January and February are very hard and if there is a heavy snowfall you
are trapped,” he said.

Rural tourism has grown in recent years in the region, which boasts picturesque tree-covered valleys, mountains and even dinosaur footprints.    

Father of two Gonzalo Esteban, 42, moved to the nearby town of Yanguas, with just 40 residents, in 2001 with his wife from Valladolid, a city of 300,000 residents, 250 km away, to open a rural inn with a restaurant
specialising in mushroom dishes.    

But Esteban said he was aware that the town, which has just seven young families including his own, could easily die out.    

“All it would take is for three families to leave with their children,” he said.

Rural tourism is not enough to make up for the decline in agriculture, as farm workers over the decades have been drawn away to factory or administrative jobs in the nearby Basque Country and Navarra.

Elsewhere in Spain, the industrialised regions around Madrid and Barcelona also proved a pull to rural workers, while out-of-date machinery and farming techniques in poorer places sent people in search of better paid jobs.

Incentives to farm

Farming is key in revitalising the deserted areas, unions and environmentalists argue.

“If there are no farmers and livestock breeders, villages become depopulated,” said Aurelio Gonzalez, head of the regional branch of the union of small farmers and breeders.

European Union agricultural subsidies, which focus on boosting competitiveness instead of “the net amount of jobs created”, are also to blame, said Daniel Lopez, of environmental group Ecologists in Action.

He pushes for more support for ecological farming, with similar programmes as in France and Italy.

During the medieval Reconquest, or Christan campaigns to recapture territory from the Moors, livestock farmers received financial incentives to set up on land taken from the Muslims, Carrascosa said.

Juan Antonio Sanchez Quero, who is in charge of fighting depopulation at the Spanish Federation of Municipalities and Provinces, said it was time to again offer fiscal incentives to livestock farmers to reverse a process that threatens to close many towns.

“Something like that” could help his region and others like it,  Carrascosa said.

By Álvaro Villalobos / AFP

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PROPERTY

Is it better for landlords in Spain to rent to temporary or long-term tenants?

If you own property in Spain that you don’t live in yourself, it’s likely that you’ll be renting it out, but is it best to rent it out on a temporary or long-term contract?

Is it better for landlords in Spain to rent to temporary or long-term tenants?

Your decision to rent out to temporary or long-term renters will of course be influenced by whether or not you intend to use your property yourself during parts of the year, but if not, it’s worth keeping in mind what the differences are. 

Besides the duration of the contract, the laws that govern each situation are different and the tax implications differ too.

READ ALSO: What are the requirements for landlords to rent out a property in Spain?

Long term contracts

Renting out long-term is governed under the Urban Leasing Law (LAU), which aims to provide shelter to families permanently and indefinitely.

It is possible to update the rent each year, depending on the price index or specific regulations at the time.

For example, in 2024, there is currently a three percent price cap. This means that you won’t be able to raise the rent on contracts that are already in force above three percent. The rental cap, however, does not apply to new contracts signed, or those signed after 2019.

Long-term contracts have a minimum duration of five years, however, your tenants can leave any time after six months as long as they give 30 days’ notice.

If you decide you need the property for yourself, you must wait until one year has elapsed on the contract and then give your tenants two months to vacate the property.   

If you decide to sell the property on the other hand, your tenant has the right to stay for up to three months or until the property is sold.

READ ALSO – Renting in Spain: When can a landlord legally kick out a tenant?

Temporary contracts

Regarding temporary rental, the law frames it under the label “rental for use other than housing”.

Temporary contracts must be for a minimum of 32 days, any shorter than this and they would be considered tourist rentals. Rentals to tourists are covered under a completely different set of rules and regulations and in many places require a tourist licence too.

READ ALSO: The rules for getting a tourist licence to rent out your Spanish property

Temporary contracts must also not be longer than 11 months. Beyond that time it would be considered a long-term rental and a long-term contract up to five years like above, would need to be issued.                                                                                                 

There is more flexibility when setting rents for temporary contracts. These are typically higher than long-term rents because of various factors, such as the addition of furniture, bills and wi-fi being included and the fact that they’re often rented out in high season. 

It’s worth keeping in mind that a high tenant turnover carries a slightly greater risk than when you rent your property out long-term. You or a management company will need to be more involved too.  

READ ALSO: Why you should consider renting out your property in Spain to students

It’s important to consider taxes when deciding to rent out to temporary or long-term renters. Photo: Andrea Piacquadio / Pexels

Declaring tax on rent from long-term contracts

You must pay taxes on your net income if you rent out long-term.  

This means adding up all the gross income for the year and deducting all the expenses involved with the rental. The following expenses are deductible:

– Waste collection fee
– Real Estate Tax (IBI)
– Insurance in case your tenants can’t pay the rent
– Home Insurance
– Community expenses
– Mortgage interest
– Real estate commissions

As the apartment serves as the tenants’ habitual residence, the tax authorities will also apply a 60 percent bonus on the net income before subjecting it to tax. This means the amount subject to personal income tax is only 40 percent of the net rental income.

These bonuses may be even higher if the conditions of the new Housing Law, introduced in 2023, are met.

Declaring tax on rent from temporary contracts

You must declare the income from all the temporary contracts that occur during the same fiscal year.

Expenses can be deducted just as before, but these may be different such as cleaning services between tenants and household bills, if they’re included.

You are also taxed on your net income, however, there are no bonuses applied like with long-term contacts as it is not considered to be the tenants’ main residence.

This means you will pay tax on 100 percent of the net income and not 40 percent like above.

You will also be charged tax on any time the apartment has been empty. This amount will depend on the cadastral value of the home and the number of days there hasn’t been anyone staying in it.

Declaring tax on rental income as a non-resident

If you’re a non-resident who owns a property in Spain and rents it out, the rules on taxes will be slightly different.

As a non-resident, you must pay income tax on rent earned in Spain as well as local property taxes such as waste tax and IBI.

If you rent your property out temporarily then you will need to submit quarterly tax returns, not just annual ones. You will also be charged tax for the periods when your property was empty. 

Those from the EU will be charged 19 percent, while everyone else will be charged 24 percent.

It’s very important to remember that if you’re from a non-EU country, such as the UK, the US or Canada you will not be allowed to deduct any expenses from your rental income, therefore you will pay tax on the full gross amount you earn.

To find out more, read our guide to non-resident tax in Spain.

Conclusion

The answer as to whether temporary or long-term contracts are best for landlords will completely depend on your situation and your preferences.

Long-term contracts are easier because you won’t have so much turnover and won’t have to be as involved. There are also various bonuses and tax breaks you can benefit from.

You can earn more from temporary contracts, but this means you will also pay more in taxes too and won’t get any bonuses. It will also take up more of your time, however, it’s a good option for those who want to use their property themselves for part of the year. 

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