Castilla-La Mancha converts rental deposits into public revenue

The Official State Gazette publishes this Monday, November 9, 2026, Law 4/2026, of May 7, on urgent measures regarding access to housing and land in Castilla-La Mancha, approved by the Cortes of Castilla-La Mancha and promulgated by the regional president, Emiliano García-Page Sánchez. The regulation transforms the rental security deposit into a public instrument and redefines residential public equipment land and public endowment housing. The text appears in Section I of the gazette, with the official reference BOE-A-2026-23390.

Security deposits become Public Law revenue

Article 1 modifies Law 2/2002, of February 7, on public protection housing of the community, to provide a new wording for its third additional provision, dedicated to the deposit of rental securities. The statement of motives justifies the change based on the need to “strengthen public intervention instruments in housing matters by optimizing existing resources.”

The central points of the new regime are:

• Lessors are required to deposit the security deposit provided for in Article 36 of Law 29/1994, of November 24, on Urban Leases.
• The deposit shall be free of charge, shall not accrue any interest, and shall be considered Public Law revenue of the Treasury of Castilla-La Mancha.
• The Department competent in housing matters may utilize up to 80 percent of the total amount of the deposits and must reserve at least the remaining 20 percent for the corresponding refunds.
• The procedures for deposit, management, refund, and control shall be established by regulation, a route that will also allow for the expansion or restriction of the persons exempt from the obligation and the reserve percentage.

The law further details the destinations of the expenditure charged to the deposited securities:

• Investments for the promotion, construction, and rehabilitation of protected housing.
• Direct actions in population centers subject to urban regeneration or renewal processes.
• Promotion of the acquisition and promotion of newly constructed housing.
• Measures to promote rentals and housing access policies.
• Cooperation with city councils to boost rehabilitation, regeneration, or urban renewal actions.
• Other incentive formulas for acquisition, such as guarantees, public warranties, and general aid.

The preamble emphasizes that the regulation also strengthens the guarantees for landlords and tenants regarding the return of security deposits, with the aim of improving legal certainty and the agility of the procedures.

New uses for residential equipment land

Article 2 modifies Legislative Decree 1/2023, of February 28, which approves the consolidated text of the Law on Land Management and Urban Activity (TRLOTAU). The change affects section 10.1 of the preliminary provision, which now defines residential public equipment land as public equipment land “intended to satisfy temporary housing needs.”

According to the statement of motives, the modification opens the uses of these lands to other groups in addition to vulnerable populations, which until now were the only group contemplated. The regulation does not detail which specific groups are incorporated nor does it set deadlines or additional conditions in the published text.

Section 21 of the preliminary provision also redefines public endowment housing: that which is built on publicly owned land classified as a general or local equipment system, upon which surface rights, administrative concessions, or equivalent legal transactions may be established.

The law specifies that the temporary ownership of the dwellings does not alter the ownership of the land nor its legal nature as public domain (demanial), and that these properties shall be allocated through rent, assignment, or another form of temporary tenure as the primary residence of persons whose income level does not allow them to access housing at market price.

Private endowment lands and public lands intended for green zones or open spaces, such as roads, squares, pedestrian areas, or play areas, are excluded from this regulation. Since they are classified as public equipment, these dwellings will not be subject to the endowment requirements provided for other uses in Article 31 of the urban law.

Entry into force and publication

The sole final provision establishes that the law entered into force on the day following its publication in the Official Gazette of Castilla-La Mancha, which occurred in issue number 92, of May 18, 2026. The text was signed in Toledo on May 7, 2026, by Emiliano García-Page Sánchez.

Impact for landlords and tenants

The conversion of security deposits into public revenue transfers the management of funds—which until now remained in the hands of landlords—to the Treasury of Castilla-La Mancha, with a minimum reserve of 20 percent to respond to refunds and a margin of 80 percent destined to finance protected housing, rehabilitation, and rental subsidies. For tenants, the regulation reinforces the guarantees for the recovery of the deposit; for owners, it adds an obligation to deposit funds with the regional administration and leaves exceptions and specific procedures to be determined by regulatory development.

Source: Official State Gazette, no. 279, of November 9, 2026, Sec. I. General provisions, pp. 150809-150810 (official reference: BOE-A-2026-23390).