X-ray of social housing in Spain: only 3% of the park is for public rent

The government is warming up its engines in the pre-election campaign for the next elections. And he does it with housing as a vein. This same week, the executive announced — via the ERC and EH Bildu — the imminent adoption of the state housing law, a regulation that raised a lot of dust in the sector. One of the objections that owners and experts have repeated the most in recent days is that the new law, as proposed, will not solve the major problems of the real estate market.

To get an idea, it is enough to analyze the data of some of our neighbors on the Old Continent. While Spain only 2.5% of its real estate park is intended for social housing, in the Netherlands, that percentage rises to 30%, according to data from the latest Housing and Land Observatory published by the General Secretariat for the Urban Agenda and Housing. that is, three out of ten homes built on Dutch soil are destined to become public real estate. The British figure is not thin either. In the UK, 18% of apartments are reserved for this purpose. Data from Eurostat and the Housing Europe Observatory confirm that public housing stock in Spain it is more than six percentage points below the average of the entire European Union.

Faced with these figures, Sánchez yesterday promised an increase from 3 to 20% percentage of public housing in Spain. Of course, without setting a specific date in the calendar. And with this goal in mind, the Prime Minister announced yesterday that he will mobilize up to 50,000 homes Bank Restructuring Asset Management Company (Sareb) — popularly known as the bad bank — to allocate them at affordable rents. “It’s a problem because A flat in Spain is a constitutional right, but not a right, which means that our young people have an unacceptable age for access to housing and emancipation,” Sánchez said during the closing of the PSOE municipal conference held in Valencia.

Thus, the Council of Ministers will give its approval tomorrow to make 21,000 homes available to municipalities and autonomous communities by assigning them for public rent. In addition, it will promote social rent in another 14,000 apartments that are already occupied and will promote the construction of 15,000 new public buildings on the available land that Sareb has.

Average price increase

Sánchez emphasized yesterday that there are studies that show that 70% of inequality in the country is a product difficulties in accessing decent housing and presented some data that reflect, “eloquently”, he assured, “the drama that this aspect represents for families”. Thus, Spain is the fourth country in the European Union where it is necessary to make a greater financial effort to pay the rent, a market where the evolution of the average price per square meter increased by 45% between 2014 and 2021.

Taking advantage of the appointment, the head of the executive power once again accused the housing policy of the PP, which he described as a “big failure” based on turning “rights into commodities” with three basic axes: “The old mantra of neoliberalism for land liberalization, tax breaks that are benefited only the builders and the privatization of public housing by vulture funds.

17% of Galician families live in rented houses

There are many families who look sideways at the present with the need to know to what extent they are This will affect the new law on housing. Especially those who live on rent. And there are not a lot of them. Because, according to the figures available from the Galician Federation of Real Estate Companies (Fegein), in Galicia almost 17% of families (16.8% to be exact) currently live in a rented apartment. The figure is even higher in large cities, among which A Coruña stands out (where 30% of the population lives on rent). Santiago, the host city of students, is not far from that percentage, where 28.2% of citizens are also tenants. They are followed by people from Ourense (27.8% live in rented property), Vigo (26%) and Pontevedra (21.5%). In Ferrol and Lugo, the figures are around 20%.

Imbalance

As Fegein explained, the big problem the market is facing is a big imbalance that exists between a stock fewer and fewer apartments and a demand that does not stop growing: “Never in history has there been a lower supply of rental apartments and higher prices than now,” explains Benito Iglesias, president of the federation.

Of the 1.6 million homes that make up the property market in Galicia, 160,000 are currently rented out and only another 3,000 are available for new residents. And also, reminds Iglesias, many of them are not in the best living conditions, are located in populated centers with little demand or even have too high prices. The problem is that there are a significant number of homes that, despite being empty, do not enter the rental market because of the mistrust this creates among their owners. “The owners are afraid of what could happen with the housing law, which leaves them in a situation of legal uncertainty,” explains President Fegeina.

For this expert, there are other reasons that explain the lack of rental apartments, among which the conversion of traditional rentals to vacation rentals, which offers greater profitability and security for apartment owners, stands out. “Incentives and tax breaks for owners are also missing. Legal uncertainty, the ban on influencing the CPI at lease renewals, the interventionist housing law and the notification of fines for empty houses are forcing small owners to look for a different alternative to the traditional rental of their home.

The sector will ask Xunta to appeal the housing law, which they consider unconstitutional

“This housing bill is a frontal attack on private property.” This is a summary of the new regulations of the Galician Association of Real Estate Companies (Fegein). Its president, Benito Iglesias, revealed yesterday that he had already asked the Junta to appeal this decree “because it is more than possible unconstitutional and because it clearly encroaches on the powers of the autonomous community”.

Fegein believes that this will challenge many owners decide to remove their homes from the rental circuit in order to avoid intervention, which is why many apartments could end up increasing other markets such as tourist sales or rentals: “Intervening in the free market and limiting prices will only lead to a decrease in supply and an increase in prices, it must be said that this crystal”, says Iglesias.

power attacks

In the eyes of this expert, the controversy surrounding regulations is not a matter of political colors or ideologies: “It’s about coherence, common sense and knowledge of the problem.” Iglesias assures that the law clearly encroaches on the powers of the autonomous communities and, he adds, its application would be complex, because, as he explains, in order to be given the alleged legal reserve, the Law on the State and Autonomous Land would have to be amended in order to apply the surcharge from up to 150% in IBI empty houses according to the proposal of the executive authority or the law on local treasuries. They want to subject us to a new regulatory maze that only contributes to the increase of already excessive legal uncertainty and disproportionate bureaucratic burden, with all the harmful economic effects that entails.

With all these braids, Fegein has already formally requested a meeting with the Xunta, to which they conveyed their position against the law, which they consider an “unmitigated attack on private property”. In this sense, it will ask the Galician administration to file an appeal for unconstitutionality against the rule that “only contributes” to increasing “the disproportionate legal uncertainty that already exists in the sector and the disproportionate bureaucratic burden”. “Housing is not a Persian market, no matter how hard the current government tries to treat it as such,” summarizes Iglesias.