Rental Property Sale: Tenant Rights and Landlord Obligations Under the LAU
Buying or selling a property that is already being rented is more common than it might seem on the Costa Blanca—especially in areas such as Orihuela Costa, Torrevieja or Cabo Roig, where many owners rent their homes to international residents. If you find yourself in this situation, whether you’re the owner or the tenant, it’s essential that you know your rights and obligations under the Urban Leases Act (LAU).
What does the LAU say about the sale of a rented property?
The LAU’s Article 14 is clear: when a rented property is sold, the new owner automatically becomes the new landlord, taking on all the obligations and rights under the lease contract. This means that they cannot change the rent, the terms, or evict the tenant before the legally established term ends.
Tenant protection timeframes
During the first five years of the contract (or seven if the original landlord was a legal entity), the new owner is required to respect the agreed duration and price. If the lease is registered with the Land Registry, the buyer must respect the full agreed term, even if it goes beyond that minimum period.
Tenant’s right of first refusal and right of withdrawal
The tenant has the right to purchase the property on a preferred basis. The owner must notify the tenant in writing of the sale conditions and grant 30 calendar days for the tenant to decide whether they want to buy it under the same conditions. If the owner does not respect this right, the tenant may exercise their right of withdrawal and keep the property.
Can the new owner evict the tenant?
No, at least not during the mandatory contract duration period. After that term has passed, if the owner needs the property for their own use (or for their immediate family), they may choose not to renew the lease, but they must notify the tenant at least 30 days in advance of the expiry date.
Practical tips for owners
- Inform the tenant in advance of your intention to sell. Transparency helps prevent disputes.
- Notify in writing the sale conditions to uphold the right of first refusal.
- Include in the deposit contract with the buyer a clause stating that the property is occupied and the terms of the lease.
- Speak to a legal advisor before signing. At Sol y Costa Mediterránea, we work with lawyers specialising in real estate law.
Practical tips for tenants
- Review your lease: if it’s registered with the Land Registry, your protection is at its maximum.
- Don’t sign anything without reading: if the new owner asks you to sign a new lease, consult a lawyer first.
- Consider exercising the right of first refusal: if the property interests you, you have 30 days to decide.
- Keep everything documented: save communications, rent receipts, and any notice from the owner.
Frequently asked questions
Can the owner sell the property if I’m living there?
Yes, they can. But the buyer must respect your lease. They can’t evict you just because the property is being sold.
What if the buyer wants the property to live in?
They must wait until the mandatory lease duration period ends (5 or 7 years) and notify the tenant with 30 days’ advance notice.
What happens if the owner doesn’t notify me of the sale?
You can exercise your right of withdrawal within 30 days from when you become aware of the sale.
Can the new owner increase my rent?
No. The terms of the original contract remain unchanged until it ends.
Conclusion
Selling a rented property doesn’t mean the lease ends. The tenant’s rights are protected by the LAU, and the new owner takes over the contract on the same terms. Both owners and tenants must know the regulations in order to act with legal certainty.
At Sol y Costa Mediterránea, as a local real estate agency in Orihuela Costa, we advise you at every step of the process—whether you’re buying, selling or renting. Contact us and we’ll help you resolve any questions you may have.
