In Spain, a forceps agreement to curb the rise in rental prices

Provided for by the coalition agreement signed at the end of 2019 by the Socialist Party of Prime Minister Pedro Sanchez and the radical left movement Podemos, this bill, intended to stem the rise in housing prices, was initially announced for the start of the year. 'year.

But the discussions were delayed, due to disagreements on the sensitive issue of rent regulation, ardently defended by Podemos. This training finally won its case, in exchange for its support for the 2022 draft budget, adopted Thursday in the Council of Ministers.

"It was a complicated negotiation," admitted the Minister of Social Rights and Secretary General of Podemos, Ione Belarra. But "between protecting people or large owners and developers, we have clearly made our choice," she added on Twitter.

Rental prices have risen sharply in recent years in Spain, due to a housing shortage. According to the specialist portal Idealista, the average price per square meter of rental properties increased by 40% between January 2011 and January 2021.

This inflation has put many tenants in difficulty, who have seen the share of their budget dedicated to housing gradually swell: according to the OECD, the 20% of the most modest families now devote no less than 40% of their income to this expense item.

Tax incitations

In an attempt to curb this dynamic, the "housing law" provides for a range of measures combining incentives and coercion. The objective is that access to housing "becomes a right" and is no longer the subject of "speculation", insisted Budget Minister Maria Jesus Montero.

The most striking measure concerns the rents of "large landlords", which can now be capped. According to the first elements communicated by the executive, this device will only concern private landlords, owners of more than 10 housing units.

For small owners, largely in the Spanish market, prices will remain free. But strong tax incentives will be put in place, with tax cuts of up to 90% for those who agree to lower their rents.

In "tense" areas, local authorities will also have the possibility of regulating rents, according to criteria defined by the State. They may also decide to increase the property tax, in the order of 150%, to promote the return to the market of empty housing.

The government, which has committed to building nearly 20.000 social housing units, is finally planning to set up checks of 250 euros per month to promote access to housing for young people aged 18 to 35 earning less than 23.725 euros per year. .

"Attack on freedom"

However, the implementation of this law could come up against difficulties. The application of several measures will indeed be the responsibility of the regions and town halls. However, many of them, led by the opposition, have already indicated that they will not implement them.

"We are in favor of people doing what they want with what belongs to them", justified the leader of the Popular Party (PP, right), Pablo Casado, accusing the Sanchez government of "undermining freedom "and" to private property ".

The leader of the opposition, who denounces "suicidal interventionism", announced that he would challenge the text before the Constitutional Court. With this law, "people will stop renting their apartments, so there will be fewer apartments, and prices will increase," he warned.

"We cannot say no to a bill that we have not been able to read and which has not been debated in Parliament," criticized Pedro Sanchez on Twitter, denouncing opposition in principle from the PP.

At this stage, no date has been given for the presentation of the bill.