Plan Reside has come into effect and radically changes the rules for tourist apartments in Madrid. If you own a tourist accommodation (vivienda de uso turístico or VUT) or are considering renting out your property for short-term holiday lets, you need to understand this regulation in detail. Fines for non-compliance can reach up to 190,000 euros. At Quikprokuo, as lawyers specialized in tourist housing in Madrid, we explain what Plan Reside means and how to adapt to the new regulation.
What is Plan Reside and why was it approved?
Plan Reside is the new urban planning regulation issued by the Madrid City Council that establishes the conditions for the operation of tourist accommodation (VUT) in the city. It replaces the 2019 Special Hospitality Plan (Plan Especial de Hospedaje), whose implementation proved complex and largely ineffective.
The main objective is to halt the loss of residential housing caused by its conversion to tourist use, especially in the historic center, where the concentration of tourist apartments has driven up residential rental prices and eroded the neighborhood fabric.
Main restrictions under Plan Reside
Plan Reside distinguishes between Madrid’s historic center and the rest of the city, applying stricter restrictions in the former:
In the historic center
The measures are particularly restrictive. Scattered tourist apartments in residential buildings are prohibited, even on ground floors. Change of use to tourist accommodation is only permitted in exclusive buildings (i.e., where all units are dedicated to tourist use), and only for a period of 15 years. Furthermore, the license is tied to the rehabilitation and restoration of the property.
In practice, this means that if you have an apartment in central Madrid and are using it as tourist accommodation within a residential building, you must regularize your situation or cease the activity.
In the rest of the city
Outside the historic center, conditions are somewhat more flexible but equally demanding. An urban planning license for change of use is required, and limitations are established based on the density of tourist housing in each area.
What happens with existing licenses?
This is one of the points that most concerns property owners. Tourist apartments that already had a valid license before Plan Reside came into effect can continue operating, but must adapt to the new conditions within the timeframes established by the regulation.
If you did not have a license and were operating de facto, the situation is much more delicate. Operating without a license constitutes an urban planning infraction that can lead to significant financial penalties.
Important: since April 2024, the granting of new VUT licenses was suspended while this regulation was being processed. With Plan Reside in force, the license granting regime has changed substantially. |
Penalties for non-compliance
The penalties established in municipal regulations for operating tourist housing without a license or in breach of the established conditions are severe. Fines range between 30,000 and 190,000 euros, depending on the severity of the infraction and factors such as recidivism or the benefit obtained.
In addition to the financial penalty, the administration can order the cessation of the activity and, where applicable, the restoration of urban planning legality, which may include the obligation to return the property to its original residential use.
As we explained in our article on the consequences of carrying out works without a license in Spain, acting without legal coverage can have repercussions that go far beyond the fine.
How does it affect property owners and investors?
Plan Reside has direct implications for several profiles:
- Owners with operating VUTs: Must verify whether they have a valid license and whether they meet the new conditions. If they operate in the historic center within a residential building, they will have to cease the activity or seek alternatives.
- Investors who purchased for tourist rental: Expected profitability may be affected if the property does not meet Plan Reside conditions. A prior legal analysis is essential before any decision.
- Homeowners’ associations: May become involved in disputes if one or more neighbors carry out tourist activity without authorization. The association has standing to demand cessation of the activity.
- Owners wishing to start the activity: Must carefully study the legal feasibility before investing, given that restrictions are much more severe than under the previous regime.
What is its relationship with the national Housing Law?
Plan Reside fits within a broader context of housing market regulation in Spain. The national Housing Law already established the mandatory registration of tourist housing and the possibility for homeowners’ associations to veto this activity by qualified majority.
At the regional level, the LIDER Law of the Community of Madrid has introduced modifications to urban planning procedures that also affect the processing of licenses for tourist housing.
The result is a multi-level regulatory framework (national, regional and municipal) that makes it essential to have specialized urban planning legal advice to navigate the regulation.
What to do if you have a tourist apartment in Madrid?
If you already have a tourist property in Madrid or are thinking of starting this activity, we recommend following these steps:
- Verify your legal situation. Check whether you have a valid license and whether your property meets Plan Reside conditions based on its location.
- Analyze the alternatives. If your property cannot continue operating as tourist accommodation, study the options: long-term residential rental (with possible tax benefits), seasonal rental, or sale.
- Do not ignore the regulation. The penalties are high and the administration is intensifying inspections. Operating without a license is a risk not worth taking.
- Consult a specialist lawyer. The regulation is complex and affects multiple areas. A mistake can be very costly.
How can Quikprokuo help you?
At Quikprokuo we are lawyers specialized in tourist housing in Madrid with more than 25 years of experience in real estate and urban planning law. Our services include:
- Legal audit of your tourist property to verify Plan Reside compliance.
- Processing of urban planning licenses for change of use.
- Defense against sanctioning proceedings for unauthorized tourist activity.
- Advice to homeowners’ associations regarding tourist housing.
- Legal feasibility analysis for investors.
Check out more articles on our urban planning blog.
Do you have a tourist apartment in Madrid?
Make sure you comply with Plan Reside.
Contact Quikprokuo for a free initial consultation.
Tel: +34 913 671 204 | Web: www.quikprokuo.com
