The Canary Islands have reached a milestone in their housing and tourism policy. On 12 November 2025, the regional Parliament approved the Law on the Sustainable Regulation of Tourist Use of Residential Housing, the first comprehensive regulation governing holiday rentals on the islands. It replaces the former Decree 113/2015, which for years offered insufficient clarity in a rapidly growing sector.
According to Miguel Ángel Rodríguez, Director General of Planning, Training and Tourism Promotion, the core vision of the new law is clear:
Tourism and Employment Minister Jéssica de León added that the reform marks a new era of urban planning and management, where the right to housing for the islands’ 2.2 million residents must be balanced with an economic activity that is important for the region but must develop in an orderly and balanced way.
Why this law was introduced
The rapid growth of holiday rentals in recent years has created tension between the economic benefits of tourism and the availability of affordable housing for local residents. In many tourist areas, pressure on the housing market has increased significantly. At the same time, municipalities lacked the tools to maintain a healthy balance.
The new law seeks to restore that balance. It provides clear rules and finally gives local governments the ability to develop policies tailored to their specific circumstances. The aim is not to discourage holiday rentals but to ensure clarity, transparency and balanced development.
Main changes
1. Municipalities now decide where holiday rentals are allowed
Local councils now have full authority to determine:
- where holiday rentals are permitted
- how many holiday rentals may exist in each area or neighbourhood
- under which conditions the activity may take place
This allows each municipality to adapt to its own housing needs, capacity, infrastructure and local context.
2. Five-year moratorium on new holiday rentals
A five-year pause is established during which no new holiday rentals may be authorised, giving municipalities time to update their urban plans.
Important nuance: once a municipality approves its new plan and designates areas where holiday rentals are allowed, new applications can be accepted again. The five-year pause does not automatically apply everywhere.
Municipalities that complete their planning earlier may therefore approve new projects sooner.
3. Existing registered owners may continue operating
The law distinguishes between existing registered owners and new applicants.
Owners who were correctly registered under the previous decree may continue renting out their properties without changes. They must, however, continue to register their activity correctly, keep documentation updated and comply with new municipal rules as they are published.
In short:
- keep your activity properly registered
- maintain all required documentation
- follow new municipal rules when published
4. 90 percent residential use, 10 percent tourist use
The law requires that:
- at least 90 percent of residential properties must remain for residential use
- a maximum of 10 percent may be used for tourist accommodation
Municipalities have six months to implement an inspection and control plan to enforce this rule.
5. Who owns holiday rentals today?
According to official figures:
- 44.6 percent of holiday rentals are owned by local individuals
- 55.3 percent of properties and 55.5 percent of tourist beds are managed by foreign owners or companies
These figures help explain why the government seeks a more balanced and sustainable market.
6. New builds may only be used for tourism after ten years
Newly constructed homes must first serve their residential purpose. They may only be used as holiday rentals once ten years have passed since construction. This prevents speculation and protects the supply of long-term housing.
7. Social housing (VPO) excluded from tourist use
Homes with protected or social housing status (VPO) cannot be used for holiday rentals. These are intended to ensure affordable housing for locals and must remain part of the residential market.
8. Entire buildings dedicated exclusively to holiday rentals are banned
The law prohibits buildings in which all units are used as holiday rentals, often owned by a single investor. These so-called “pseudohotels” function as hotels without regulation and remove entire buildings from the residential market.
This measure targets large-scale investors, not individual owners.
9. More inspection and municipal support
Municipalities must create an inspection plan within six months to:
- combat illegal rentals
- reduce neighbourhood disturbances
- protect compliant owners
The regional government will provide a model ordinance if needed.
What this means for owners and investors
For existing registered owners, little changes: they may continue renting as usual.
For new projects, approval will depend on each municipality’s updated zoning plan.
For investors, location becomes more important than ever. Holiday rentals will remain possible, but only in zones where municipalities explicitly allow them.
Conclusion
The new holiday rental law in the Canary Islands creates a clear, sustainable and locally adapted framework. It protects the residential market, strengthens the role of municipalities and seeks a long-term balance between tourism and quality of life.
Registered owners remain protected, while new projects will depend on municipal planning. With measures such as the 10 percent limit, the ten-year rule for new properties, the protection of social housing and the ban on entire tourist buildings, the law promotes a more responsible and balanced model.
About us ☀️
Our team supports clients from A to Z in purchasing property in Spain. With offices in Antwerp, Knokke, Moraira and Tenerife, we stay close to our clients, both in Belgium and in Spain.
Our Dutch-speaking area managers live and work locally, know the market inside out and follow the latest legal and urban developments daily. They guide you step by step so that you can make well-informed and confident decisions when investing in your home under the Spanish sun.