First, remove the old local files source in the app's Settings. If that doesn't work, save the songs you have locally in the location you want, turn off Local Files inside the app's Settings, and then follow the steps listed below to do a clean install of Spotify:
- Click Spotify in the menu bar then Quit Spotify.
- Open Finder then click Go > Library in the menu bar. (You may need to hold the Alt key if Library isn’t visible).
- Open Caches and delete the com.spotify.Client folder.
- Click the back arrow.
- Open Application Support and delete the Spotify folder.
- Download and install Spotify.
- Turn on the Local files setting in the app's Settings if necessary.
You can read more about Local files in this FAQ.
This Spotify Answer was submitted by @Loxer.
Didn't help? Search for more Spotify Answers, or create a new thread and ask the Community.