Spain: Government Presents Bill On Right To Housing

Spain’s Minister for Transport, Mobility and the Urban Agenda, Raquel Sánchez, has presented a draft bill on the Right to Housing to the Council of Ministers, which “aims to configure housing as the fifth pillar of the Welfare State” and as a “powerful tool to fight inequality, marginality and exclusion”.

According to the government, this is a “historic” regulation, which reinforces the exercise of the constitutional right to decent and adequate housing, which the minister defined as that which is “habitable, accessible, energy efficient and which guarantees access to basic supplies without its enjoyment entailing an unaffordable financial effort for citizens”.

Sánchez explained that the text pays special attention to the people with the greatest difficulties and to those areas where there is the greatest tension in the market, affords legal security and is a guarantee because it protects the renter, the tenant and the landlord and does not encroach on the competences of the regional governments.

The bill, according to the minister, aims to increase public housing stock, which only covers 1.6% of households compared to the 10% provided by other neighbouring countries, as well as to combat abusive price rises. “We took the opposite path to liberalisation and real estate bubbles and connected with the reality of thousands and thousands of families who could not even afford basic supplies,” she said.

What’s new in the bill?

The bill prevents the sale of public social housing stock to investment funds, as it is subject to permanent protection and cannot be sold; it establishes the indefinite classification of social housing, and introduces the concept of incentivised affordable housing, which is privately owned housing that is granted certain tax or other benefits, on the condition that it is intended to be rented at a reduced price.

Raquel Sánchez also stressed that the mobilisation of empty homes is encouraged by introducing the possibility for local councils to apply the Property Tax surcharge to homes that have been empty for more than two years if the owner has four or more homes in the same municipality.

The regulation improves the eviction procedure in situations of vulnerability by streamlining communication between judges and social services, which will have to provide a housing response to families. The minister indicated that the period of suspension of mortgage foreclosures has been extended from one to two months when the owner of the property is an individual and from three to four months when the owner is a legal entity.

Another initiative is to promote subsidised housing for rent at a limited price. Sánchez has advanced that a 30% reserve is established for urbanised land, establishing the compensation that corresponds to the owners when acquired rights are affected. And of this land reserve, the possibility of 50% of this 30% being used for rental housing is envisaged.

Raquel Sánchez added that the future regulation will allow the regional governments to declare areas with a stressed residential market, in which tenants will be able to take advantage of an extraordinary extension of their contracts, on an annual basis, for a maximum period of three years.

The draft bill defines a “large property holder” as a natural or legal person who owns more than ten urban properties for residential use or a built-up area of more than 1,500 square metres. Where the owner is a large legal entity, the rent of new contracts concluded in stressed areas shall be limited by the previous contract or the ceiling of the price applicable under the reference price index system; there shall be a period of 18 months from the adoption of the law for the application of the latter limitation.

With regard to the tax framework, the minister highlighted that the regulation of personal income tax is being improved to stimulate the rental of permanent housing at affordable prices. A 50% reduction percentage is set for new rental contracts, which may be increased depending on criteria such as a drop in rent in a stressed area or first-time renting of housing in these areas to young people aged 18 to 35.

Raquel Sánchez added that the law reinforces collaboration between public administrations in the field of housing, rehabilitation, regeneration and urban renewal, and encourages public-private partnership with the sector’s agents.

Draft Bill on the Quality of Architecture

The Government has analysed the draft bill on the Quality of Architecture, which aims to position architecture as an asset of general interest to be preserved and promoted, and is one of the reforms included in the Recovery, Transformation and Resilience Plan.

The Minister for Transport, Mobility and Urban Agenda stressed that the Executive aims to bring architecture closer to society and to recognise the value it contributes to economic and social development through renovation, the improvement of buildings and the protection of cultural and natural heritage.

It is also a legislative instrument that will help consolidate a new model of economic, energy, ecological and social transition driven by the NextGenerationEU Funds.