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Lorenzo Mestre poses next to his motorhome on a street in Palma de Mallorca. Lorenzo has been living in the motorhome for 1 year, due to high rental prices. -- AFP
Lorenzo Mestre poses next to his motorhome on a street in Palma de Mallorca. Lorenzo has been living in the motorhome for 1 year, due to high rental prices. -- AFP

‘Unsustainable’ housing crisis ails Spain’s govt

MADRID: Spain’s acute housing crisis is piling pressure on Socialist Prime Minister Pedro Sanchez as his government’s measures yield few results and frustration boils over among beleaguered citizens.

“Finding a place to rent has now become a minefield, especially for the young,” 24-year-old Juan Lozano told AFP. “There is hardly any supply, and when there is, the prices are sky high.” Lozano was one of around 22,000 protesters who thronged central Madrid on Sunday to vent their anger at spiraling costs and the scarcity of new homes as well as threaten landlords with a rent strike. Housing has been an unsolvable conundrum for successive governments in Spain, which remains scarred by a 2008 property market crash that accompanied the global recession.

But since the COVID-19 pandemic, the crisis has become “unsustainable”, Lozano said. The price of a square meter for rent has soared by 82 percent over the past 10 years, according to online property platform Idealista. That increase comfortably outstripped average wages, which only crept up by 17 percent in the same time, according to Spain’s national statistics institute, making finding a home mission impossible for low-income households. Compounding the problem is the dearth of social housing, which only makes up 2.5 percent of the total stock compared with an EU average of 9.3 percent.

The crisis has dogged Sanchez’s fragile minority government which prides itself on defending the working classes, as tensions simmer with left-wing allies in parliament and exasperated citizens grow increasingly impatient. “Rents are suffocating us and no one does anything,” said the national tenants’ union. “The majority of society has been paying for the housing crisis for too long, while a minority gets rich at the expense of their work.” Trade union CCOO said access to housing had become a “fantasy for large parts of society” and urged the state to enshrine the right to “a decent and suitable home” in the constitution. — AFP

The government introduced a landmark law in May last year that plans to boost social housing, cap rents in areas with the greatest market squeeze and punishments for owners who leave their properties empty. But the legislation has so far failed to rein in galloping rent hikes, which hit 10.2 percent year-on-year between July and September with peaks of 15 percent in large cities such as Madrid and Valencia. The Bank of Spain says 600,000 new homes are needed by the end of 2025 to meet the population’s needs but estimates fewer than 100,000 are built each year. The law has also sparked a stand-off between Madrid and some regional governments responsible for implementing it. 

Sanchez defended his government’s record on Monday, saying it had increased resources dedicated to housing eightfold since he took office in 2018, but conceded “magic wands” would not solve the “difficult” problem. He said housing would be his government’s “absolute priority” and wanted to avoid “a Spain with wealthy owners and poor tenants”, announcing a housing package of 200 million euros ($218 million) for the young. The government recently announced the end of so-called “golden visas” that granted residence permits to foreigners who invest in real estate, who critics accuse of encouraging speculation in big cities.

It has also promised to crack down on the spread of tourist apartments, which reduce the number of homes available on the market, and accelerate the construction of new houses.

For many Spaniards weary of false dawns, more must be done. “We have had promises for years” but “few results”, Laura Barrio of the collective “Stop Desahucios” (Stop Expulsions) told AFP. “Structural reforms” are needed to solve the problem “from the roots”, she added. — AFP

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