The government is investing in this final phase of the legislature. access living place. That is why the agreement with EH Bildu and the ERC to implement one of the landmark laws of this legislature, accompanied by announcements such as the mobilization of 50,000 properties from Sareb or the ‘bad bank’ – the owner of toxic real estate assets from the financial sector. After the 2008 crisis – corporate housing, with Spain at the bottom in the EU. 21 thousand of this amount will be sold to autonomous regions and municipalities. And the latest announcement: financing 43,000 affordable rental homes. Because, especially for young people, it becomes difficult not only to buy but also to rent.
What is the weight of rent in the real estate market?
Spain is a land of owners. Although leasing is gaining weight, it still accounts for only 17 of every 100 houses. As of 1 July 2021, 15.9% of Spanish households are residing in rental housing; this rate is 2.4 points higher than 13.5% according to the 2011 census and 75.2% of households live in a house they own. Compared to 78.9% in 2011, according to the survey of the basic characteristics of the population and homes published by the National Institute of Statistics (INE) last February. According to the same study, at least 481,000 rented households spend more than 40% of their net income paying rent.
What factors affect buying or renting?
The truth is that in recent years buying a house has become ‘cheaper’ than renting it. historically low interest rates, aside from the buy entry, which is usually 20% of the total price. In fact, by April 2022, euriborThe reference used to update variable mortgages has remained in negative territory for six years. Adding the difference agreed in the contract, a positive rate was obtained, but very low. Like this, the cost of owning a property was lower than the average for a rental. That is, until after the war in Ukraine and the rising prices, the Government decided to put a 2% ceiling on rent increases in the housing law, which was extended until December and agreed with the ERC and EH Bildu. It will be 3% next year until a benchmark that will separate them from the CPI in 2025. Before we set the cap, rents were up almost 8%. In fact, the monthly payment for a typical mortgage of around €150,000 was €540.14 in March last year, 24 years with a margin of 1%. The average monthly rent for a 100-metre flat was around 1,000 euros in March last year. And according to Idealista, it’s about 1,100 euros today. In any case, the average ranges from, for example, around 1,800 Euros in Barcelona or 1,600 Euros in Madrid to 730 Euros in Soria or 670 Euros in Cuenca for a house with the same features.
Can an increase in the price of money change the trends?
The increase in interest rates affects those who have floating rate housing loans and above all those who are in the first third of the loan repayment period, that is, during the period when the interest is mainly paid. It also makes new mortgage loans more expensive, especially those with fixed rate, which took the lead until last summer. In any case, the problem is that The scarce rental offer makes the offer more expensive and places it at levels hardly accessible to middle- and especially low-income families.. As INE statistics reflect, nearly half a million rental households devote more than 40% of their income to paying rent. For this reason, the increases were limited for this year and included in the housing law for the next year, where the upper limit would be 3%. However, while the norm will be insufficient for tenant representatives, the norm for real estate agents and industry spokespersons will further restrict the offer. And in this context, the industry is starting to warn of a certain slowdown, due to the rise in money prices and scarce supply, which is fueling prices and fueling the specter of a real estate crisis.
What is the role of the public sector?
The role of the public in the housing market is decreasing. In the 1980s, nearly half of the market was social housing, but over the years it has dropped to 2.6% today. and about this A level that brings the country to the bottom at the European level.. And in the European Union (EU), social housing accounts for 9% of the total, but even more so in the UK at 18%; Austria with 23%; or the Netherlands with 30%. And even the numbers are very small when it comes to it. social rent. According to the latest statistical data corresponding to 2019, there were only 2,479 social rental homes built in the whole of Spain. Now the Government intends to multiply this offer with the announcement of Sareb houses.