Renting out an apartment in the Canary Islands should be a stress-free source of income. Yet many property owners make mistakes that cost them money, time, and peace of mind. After years of managing properties across the islands, these are the mistakes we see most often — and how to avoid them.
1. Setting the price without researching the market
The most common mistake is pricing based on gut feeling, what your neighbour charges, or what you need to cover your mortgage. None of those benchmarks reflect the actual market value of your apartment.
How to avoid it: Before listing, research similar apartments in your area (same number of bedrooms, similar condition, same location). Check listing portals like Idealista or Fotocasa, but keep in mind that published prices are asking prices, not actual closing prices. If your apartment has gone more than 3 weeks without any viewings, you’re probably priced above the market.
2. Not properly screening tenants
The rush to get the place rented leads to accepting the first candidate without verifying their financial standing. A tenant who doesn’t pay is infinitely worse than a month with an empty apartment.
How to avoid it: Always request documentation proving income: payslips, employment contracts, or tax returns. Ask for references from previous landlords when possible. And don’t skip the contract — a verbal agreement offers you no protection in case of non-payment.
3. Neglecting the condition of the apartment
Many owners believe that a rental apartment doesn’t need to be in good shape. It’s actually the opposite: a well-presented apartment attracts better tenants, commands higher rent, and reduces turnover.
How to avoid it: You don’t need a full renovation, but you do need the basics: fresh paint, taps that don’t drip, appliances that work, and spotless cleanliness. We have a step-by-step guide on how to prepare your apartment for rental in the Canary Islands. A well-maintained apartment signals that the owner cares, and that attracts tenants who will also take care of the property.
4. Not having a solid contract
Renting with a generic contract downloaded from the internet is a recipe for trouble. A good rental contract should address specific situations: duration, renewal terms, penalties for non-payment, a detailed inventory, pet policy, and who pays for which utilities.
How to avoid it: Invest in a contract drafted or reviewed by a lawyer specialising in tenancy law. We have compiled the 10 essential clauses that must not be missing from your rental contract. The 200-300 it costs can save you thousands in future disputes. Make sure both parties also sign a detailed inventory with photos documenting the condition of the apartment.
5. Ignoring tax obligations
Rental income is taxable under IRPF (Spain’s personal income tax). Many owners either fail to declare it or don’t apply the deductions they’re entitled to, ending up paying more than they should.
How to avoid it: Always declare your rental income. Remember that you can deduct expenses such as IBI (property tax), community fees, home insurance, repair and maintenance costs, mortgage interest, and property depreciation. If you rent the apartment as the tenant’s primary residence, you’re entitled to a 60% reduction on the net income. Consult a tax advisor to optimise your situation.
6. Not having rental default insurance
Rental default insurance costs between 3% and 5% of the annual rent. Going without it is a risk that simply doesn’t make sense.
How to avoid it: Take out a policy that covers at least 12 months of non-payment, legal defence costs, and vandalism. Some policies also include tenant screening. This is an investment, not an expense — a single default can cost you more than years of premium payments.
7. Managing everything without professional help
This is perhaps the most expensive mistake in the long run. Managing a rental involves posting listings, screening candidates, conducting viewings, drafting contracts, collecting monthly payments, handling issues, coordinating repairs, and being available when problems arise. If you have a job, a family, or other commitments, rental management eats into time that’s worth more than you think.
How to avoid it: Calculate how many hours you actually spend managing your apartment each month and put a price on each hour. If the result exceeds what it would cost to delegate, you have your answer. Models like rent-to-rent allow you to step away completely in exchange for a fixed guaranteed rent — no finding tenants, no chasing payments, no surprises. If you are considering delegating, here is a guide on how to choose a rental management company in the Canary Islands.
The alternative: zero management, guaranteed rent
Each of these mistakes has a solution. But the most efficient solution is not having to deal with any of them at all. The rent-to-rent model eliminates all these risks in one go: a professional company rents your apartment, pays you a fixed rent every month, and takes care of absolutely everything.
If you have an apartment in the Canary Islands and want to find out how much you could earn without lifting a finger, request a free valuation. No obligation, no pressure.
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