COLIVING AND RENT LIMITS IN CATALONIA: LEASE OR HOSPITALITY?

Since 1 January 2026, Law 11/2025 has extended Catalonia’s rent containment limits to room rentals and seasonal lets in stressed market areas — which cover almost the entire region. For many coliving operators, this naturally raises a legitimate question: is my activity actually a residential lease, or is it a supply of hospitality services? This is not a matter of labels, but rather of genuine legal nature. Indeed, when a coliving genuinely and continuously provides services characteristic of the hotel industry, the relationship stops being a lease under the Urban Leases Act (LAU) — and therefore under Law 11/2025 — and instead becomes a hospitality activity.

What Law 11/2025 changes for coliving

Law 11/2025 of 29 December, on housing and urban-planning measures (DOGC no. 9574, of 31/12/2025; BOE no. 61, of 10/03/2026), extends rent containment limits — historically reserved for standard residential leases — to two arrangements that the coliving sector uses frequently.

Room rentals: a combined cap under the SERPAVI index

Room rentals are now expressly regulated: the sum of the rents for all rooms in a property cannot exceed the maximum set by the SERPAVI index for that property let as a whole. This closes the option of splitting a dwelling into rooms to exceed the cap applicable to a single unified lease.

Seasonal lets in stressed market areas

Seasonal lets for work, study or medical reasons are now subject to the same limits as standard residential leases in stressed market areas, which cover more than 90% of the Catalan population. The decisive factor is no longer the duration of the contract, but its actual purpose: if it meets a housing need, the residential regime applies.

The law does not distinguish between quality models and abusive situations: it applies to all leases equally. The question, therefore, is not how to avoid the law, but whether the relationship between operator and resident is, in law, a lease or a hospitality contract. Its true nature — not its label — determines the applicable regime.

The hospitality-services argument (art. 20.One.23 of the VAT Law)

Why hospitality services displace the LAU

Article 20.One.23 of the VAT Law provides that residential leases are VAT-exempt, except where the landlord provides services characteristic of the hotel industry. When that happens, the relationship ceases to be a lease under the LAU and instead becomes an economic activity of hospitality. As a result, the consequence is direct: if the activity is hospitality, then Law 11/2025 — which governs lease contracts — does not apply to it, because the relationship was never within its scope.

This nuance is worth stressing, because it is the core of the analysis: the point is not about “exiting” the law, but about a hospitality activity that never entered the tenancy regime. In practice, the boundary is drawn by the reality of what is provided, not by an intention to avoid the rules.

The Tax Authority’s doctrine

The Spanish Tax Authority (DGT) has shaped this boundary in four rulings that are especially relevant to coliving:

• V2607-22 (22/12/2022) — A ruling specifically on coliving. Services such as breakfast, 24-hour staffed reception, gym, swimming pool, shared rooms and community events included in the base price constitute hotel-type services. The arrangement is subject to 10% VAT and falls outside the LAU.
• V1096-24 (22/05/2024) — An important nuance: a 24-hour telephone helpline for resolving incidents is not a hotel-type service. A staffed, in-person reception is.
• V0261-25 (06/03/2025) — Only services provided periodically during the stay qualify as hotel-type. One-off cleaning at check-in and check-out does not.
• Ruling of 08/11/2024 — On-demand cleaning charged separately is taxed at 21% as an independent service, but does not pull the main contract into the hotel category if it is not included in the rent.

Which service is hotel-type, and what VAT applies?

This table summarises how each service is classified under the Tax Authority’s doctrine and the corresponding VAT rate. It is the practical tool for assessing whether a coliving model provides genuinely hotel-type services.

Checklist for the coliving operator

If your model genuinely provides hotel-type services on an effective basis, there is a solid legal argument that the relationship with the resident is not a lease under the LAU and that the rent limits of Law 11/2025 do not apply. That said, this argument rests on substance, not form, and demands rigour on four fronts:

• Draft the contract as hospitality, not as a lease. The agreement must be structured as a hospitality contract, with its own cause and obligations.
• Provide the services for real and continuously. Including them in the contract is not enough: they must actually be provided on a regular basis throughout the stay.
• Charge 10% VAT and declare the activity as hospitality. This is the coherent trade-off for exclusion from the tenancy regime (IAE Group 685).
• Document the model with INCASÒL. The Contract Supervision Commission created by Law 11/2025 can inspect listings, contracts and the actual provision of services.

Risks and limits of this strategy

Honesty about the limits of the argument is part of the analysis, not a footnote. Bear the following in mind before making any decision:

• The DGT rulings resolve VAT, not Law 11/2025. Applying their conclusions to the tenancy-law context is a solid legal argument, but not yet confirmed by specific case law.
• Substance prevails over form. A contract that invokes non-existent hotel services is a simulation, exposed to reclassification and penalty. Tellingly, this anti-avoidance principle is the very one that inspires the law itself.
• The criteria may evolve. A new binding ruling, an INCASÒL decision or a first court judgment could qualify or displace this analysis.

For all these reasons, before building a business model on this basis it is essential to obtain individual legal advice that assesses the specific case.

Frequently asked questions

Is coliving subject to Catalonia’s Law 11/2025?

It depends on its legal nature. If the relationship with the resident is a room or seasonal lease, it is subject to the rent limits in stressed market areas. If it is a hospitality activity with genuine hotel-type services, there is a solid argument that it falls outside the law’s scope — though without case-law confirmation yet.

Which services turn a lease into hospitality?

According to the DGT, services characteristic of the hotel industry provided periodically during the stay: breakfast included, staffed 24-hour reception, periodic room cleaning, linen change and community activities included in the price. Utilities, cleaning only at check-in/check-out and a telephone helpline for incidents do not count.

What VAT applies to coliving with hotel-type services?

Where services characteristic of the hotel industry are included in the price, the supply is taxed at 10% VAT, as opposed to the exemption that applies to residential leases. On-demand cleaning with a separate price is taxed, where applicable, at 21% as a separate service.

Is it enough to include the services in the contract?

No. Classification depends on the real, continuous provision of services, not on their mention in the contract. An agreement invoking hotel-type services that are not actually provided is a simulation and is exposed to reclassification and penalty.

What can the INCASÒL Supervision Commission inspect?

The Contract Supervision Commission created by Law 11/2025 has the power to inspect listings, contracts and the actual provision of services. That is why the hospitality model must be real and documented, not merely formalised on paper.

Is this argument confirmed by the courts?

Not yet. It rests on the DGT’s consolidated VAT doctrine, but applying those conclusions to Law 11/2025 has not been confirmed by specific case law. It is a solid argument that carries risk and requires individual advice.

Conclusion

Law 11/2025 has closed the traditional routes for placing room and seasonal rentals outside rent containment. However, the boundary between lease and hospitality remains legally relevant: a coliving that genuinely provides hotel-type services operates in the field of hospitality, not of leasing. Therefore, the question is not how to avoid the rules, but how to classify the activity correctly and accept the regime — both tax and legal — that goes with it.

Ultimately, the success of this approach depends on substance: real services, a coherent contract, correct taxation and solid documentation. And, above all, on an individual analysis that weighs the risk of each specific model.