Haven't looked at Madrid for the last year or so, since prices went up. I would reckon that the general market may have missed the boat with regards to making any kind of killing -- should have been there about two or three years ago when bargains were available -- but the city is vibrant and I am told that the rental market is strong although returns are not brilliant.
I am aware that long term tenants in Spain can acquire rights that are hard to topple -- has anyone any more legal detail on this?
Basically, if the tenant stays longer than a year, they can not be removed for 5 years. Their lease will automically get renewed every year. After those 5 years, the owner has the option of removing the tenants (giving at least 30 days notice before the 5 year period is up), but if they don't, the tenants will then have a further 3 years security of tenure.
There are also general restrictions on the amount you can raise the rent by. It's tied to inflation and not the market rate.
Most other things are similar to Irish law... the landlord is reponsible for maintaining the property, the tenants can't damage the property, be anti-social etc.