TL;DR: From 2024-2025, Costa del Sol (especially Málaga and Fuengirola) has introduced strict new rules for short-term rentals: new licenses require approval from 3/5 of property owners, licenses are no longer transferable, and local restrictions are much tighter. Mid- and long-term rentals remain attractive and less regulated.
General Legislative Changes
Major Update on Tourist Licenses (August 2025)
A recent Ministry of Justice resolution has simplified how tourist licenses are handled during property sales. The key change is that the license is now permanently tied to the property, not the owner.
What This Means for Buyers & Sellers License Follows the Property: When a property is sold, its tourist license is automatically transferred to the new owner. The sale does not cancel the license.
Immediate Rental is Legal: The new owner can legally operate the property as a tourist rental immediately after the purchase. Delays in updating the official Tourism Registry do not affect this right.
Reporting is Mandatory: While the rental activity is lawful, the new owner must report the change of ownership to the Tourism Registry to avoid administrative penalties. Failure to do so on time may result in fines.
In short, buying a property with a license secures your right to rent it out for tourism, but completing the administrative update is a crucial final step.
In 2024 and 2025, Costa del Sol experienced major changes in short-term rental regulations, following Decree 31/2024 (from January 29) and the new national law effective April 3, 2025. These measures aim to enhance service quality, protect residents, and limit the impact on the housing market.
Key elements of the new legislation:
Homeowners’ Association Approval: Starting April 3, 2025, any new short-term rental license in a residential building requires explicit approval from 3/5 (60%) of homeowners (by both number and ownership share). Without this approval, the community can prohibit or take legal action to stop the activity.
Exception: Licenses obtained before April 3, 2025, remain valid for the current owner and do not require reauthorization or additional community approval.
Licenses are no longer transferable: When a property is sold, the license does NOT transfer automatically. The new owner must reapply for authorization, including obtaining community approval, with no guarantee of success.
Elimination of the First Occupation License (F.O.L.): Owners can now self-declare compliance with urban planning rules, without needing this document, but must still meet all legal standards and may be subject to verification.
Quality and technical standards: Properties must have at least 14 sqm per occupant, two bathrooms for over five occupants, three bathrooms for over eight, ventilation, air conditioning, heating, first aid kit, smoke detector, fire extinguishers, 24/7 emergency contact, and an evacuation plan.
Municipalities have more power: Cities can limit the number of licenses, impose extra conditions (such as independent access), and increase local taxes for tourist properties.
Relevant Local Situations: Málaga and Fuengirola
Málaga
Since 2024, Málaga has imposed a three-year freeze on new tourist rental licenses in 43 districts where holiday rentals exceed 8% of the housing stock.
Only properties with independent street access are eligible for new licenses in these areas.
These measures aim to protect residential housing supply and address concerns about overtourism and rising rents.
Fuengirola
Since February 2024, following Decree 31/2024 and urban planning changes, the city requested the cancellation of around 600 pending applications for new licenses that did not meet the independent access requirement (not existing licenses).
The waste management fee for tourist properties was raised to the business level (from about €15-20/month to up to €70/month for large properties).
The 30% discount on the property tax (IBI) for tourist apartments was eliminated.
Other Important Aspects
Digital platforms (Airbnb, Booking): All listings must display the unique registration code. Platforms are required to remove listings without a valid license, and rental activity data is shared with authorities for tax and legal checks.
National Registry: As of January 2, 2025, all short-term rental properties must be registered in the National Registry for Tourist and Seasonal Rentals. Registration becomes mandatory from July 1, 2025. Each property receives a unique ID, which must be shown in all listings; failure to comply can result in removal from platforms and fines.
Tax obligations: Rental income must be fully declared, regardless of contract length. Fines for non-declaration can reach up to 50% of the owed amount, plus interest and additional penalties.
Rental Yields: Gross vs. Net
Net yield includes all associated costs (local taxes, maintenance, repairs, insurance, property management fees-typically 20-25%, platform commissions 10-15%, admin costs, vacancy periods).
| Rental Type | Gross Yield | Net Yield | Demand | Regulations | Owner Usage Flexibility |
|---|---|---|---|---|---|
| Short-term (tourist) | 6.5% - 11% | 3.5% - 6% | Very high (seasonal) | Strict in Málaga & Fuengirola | High |
| Mid-term (2-11 mo.) | 5% - 8% | 3% - 5.5% | High and steady | No major restrictions | Good |
| Long-term (12+ mo.) | 4% - 7% | 2.5% - 4.5% | Very high | No restrictions | Low |
Solutions for Investors and Second-Home Buyers
Mid-term (minimum 2 months): This segment is not affected by short-term restrictions, has strong demand (digital nomads, expats, professionals), and competitive net yields.
Long-term (over 12 months): Offers stable income, low vacancy risk, low costs, and solid net yields, especially in new developments with modern amenities.
The supply of quality long- and mid-term rentals is limited, supporting good yields, especially as rents in Costa del Sol have risen in the past year.
What is the Licence of First Occupation (F.O.L.)?
The Licence of First Occupation (Licencia de Primera Ocupación, LPO) is a certificate issued by the local town hall confirming that a newly built or renovated property complies with all urban planning, safety, health, and access regulations, and is fit for habitation. It is required for connecting utilities (water, electricity, gas) and often for obtaining a mortgage or legally registering the property for rental. As of 2025, the F.O.L. / LPO is no longer mandatory for tourist rental licensing; owners can self-declare compliance with planning rules, but must still meet all legal standards.
Conclusion
Costa del Sol’s 2024-2025 reforms have made short-term rentals much more restrictive in certain towns, especially Málaga and Fuengirola, with a focus on explicit homeowners’ association approval and non-transferability of licenses. Licenses obtained before April 3, 2025, remain valid for the current owner and are exempt from the new approval requirement. For investors and second-home owners, mid-term and long-term rentals remain attractive, with solid net yields and high demand, particularly in modern developments. Compliance with new rules and tax obligations is essential for successful investment.