The Spanish government introduced a housing law to regulate rental prices | The measure paves the way for the approval of the draft budget

The Spanish government has unveiled a series of measures to regulate the price of rents as part of an agreement between the two parties of the ruling left coalition, the PSOE and United We Can. The so-called housing law, which will be officially presented to the Council of Ministers on Thursday, includes a drop in the rental value of properties in the hands of large landlords and declares, instead, that smallholders will have a “price freeze and tax incentives” formula.

The head of the People’s Dayr (PP) and main opposition force in Spain, Pablo Casado, announced that the law will appeal before the Constitutional Court. As soon as a draft of the project was known, the opposition and the business chamber came out to condemn what they saw as an attack on private property. In all cases, the measures pave the way for the approval of the budget proposal, fundamental for the government of Spain.

Project details

The law proposed by the Pedro Sánchez government aims to regulate the rental price to large landlords and includes measures for so-called protected housing, promotes an increase in the public housing stock for rent and research impose a surtax on inactive properties with an increase up to 150 percent property tax (IBI).

Although the Executive has not yet detailed the nature of the mechanism it will apply to regulate rents or the type of landlords it will target, the newspaper The country expected that the measure will seek to fall on the owners of more than ten dwellings. The law also ratifies the construction of some 20,000 social housing units and the rehabilitation of entire neighborhoods, according to the socialist executive, for an amount of one billion euros.

The initiative provides “tax incentives” for owners who agree to rehabilitate their homes and aid of 250 euros per month for two years for young people with limited resources. “In the case of the most vulnerable families, it can be supplemented by more direct rent aid of up to 40%”, indicates a government press release.

The regulation of rents has been demanded for a long time by United We Can, so that conditioned its support for the 2022 draft budget on an agreement from its socialist ally for this key measure. From now on, Sánchez’s minority government will have to negotiate with several small parties, including the Catalan separatists of the ERC, to ensure that the budget is approved in parliament.

First housing law in 40 years

The President of the Spanish Government, Pedro Sanchez, defended this Wednesday that the law pushed to regulate rents It will be “socially engaged” and “responsible and balanced” from the point of view of “absolute” respect for private property.. In this sense, Sánchez urged the PP to give him an “opportunity” and to build a “state agreement” around this rule to guarantee the constitutional right to housing.

During a press conference from Slovenia after the European Union-Balkans summit, the chief executive left a clear message to those who oppose the project: “Those who have already announced an appeal to the Constitutional Court do not know the text, they did not give the parliamentary process a chance to be able to present amendments ”. In exchange, Sánchez was proud of the government for having been able to design and accept, “in the midst of a pandemic”, the first housing law in 40 years of democracy. which configures “a milestone which deserves the respect of all forces”.

“Interventionism is suicidal”

Pablo Casado He admitted that “the housing problem in Spain is very serious” and that his party has said “something must be done”. However, he criticized a measure which, in his opinion, “send a message of legal insecurity that the government can intervene in your private property”. The head of the PP argued that “interventionism is suicidal, because in the end what people will do is not put apartments for rent, and therefore there will be less accessible housing and prices will increase. “

For this reason, Married explained that the intention of the training he leads is appeal the bill, the fine print of which is not yet known, before the Constitutional Court. He also assured that, if approved, the law “will not be applied” in the municipalities and regions governed by the PP. “We are in favor of the freedom of everyone to do what they want with what is theirs,” said the right-wing leader.

The President of the Spanish Confederation of Professional Organizations (CEOE), Antonio Garamendi, accompanied the rejection of the opposition and warned that the housing law “sends a message of lack of security and freedom of action in Spain” to foreign investors. Garamendi assured that “all that is regulatory policies have already proven themselves in Europe as failures“.

Prices in the residential real estate sector have risen sharply during the health crisis in Spain, due to the imbalance between supply and demand. This situation has led the inhabitants of several cities to demonstrate to demand the regulation of rents.