In the housing market, the impossible becomes possible. According to the data of the Spanish Mortgage Association (AHE), taking into account the appraisal values of the Ministry of Transport, Mobility and Urban Agenda (Mitma), There are 11 provinces in Spain where sheltered housing prices are more expensive than the free market. This means that buying a home with no sales or rental restrictions is cheaper than buying a home that does.
There are various types of social housing, from classic formal social housing (VPO) to limited price public housing (VPPL) or basic VPPB and even social housing, with varying maximum sizes. The latter should be used for rental. The nature of such properties is given by the type of land on which they are built, established in the planning of a city. To be sold or rented at the maximum price determined by the autonomous community.
Luis Corral, CEO of Foro Consultores, previously states: “There is no point in paying more for a free house than for a protected one.” This event is happening in the provinces teruel, real city, Basin, lleida, Lion, lugo, toledo, Kordova, Albacete, Ourense And kalelon. In these regions, the differences between the two house types range from just nine euros per square meter in Castellón to 335 euros in Teruel. Most of these towns are located in the interior of the peninsula and are outside the spotlight of real estate investors.
How is it possible for this phenomenon to develop?
The manager of Foro Consultores points out several situations that can lead to the price of free housing being lower than the price of protected housing. The first one is a “temporary imbalance or free housing supplyIn the principle used, a Broken or poorly positioned parkingGenerally, this point contains populations that continue to lose residents, causing prices to remain low and making it difficult for them to rise above the maintained level.
Moreover can occur in a down cycle real estate market. This happened in later years puncture housing bubble 2008: The prices of the modules, which are the maximum price at which subsidized housing can be sold, are determined by communities in a rigid and artificial way, while the oversupply and low demand in the market have caused prices to fall in the free market. This causes this discrepancy to arise in the housing market, where some prices are lower than others, when it should be the other way around.
On the other hand, there is also a situation that there is a cost to building a sheltered house from scratch, especially after the inflation in recent months. A few years ago it could be built for less than 1,500 euros per square meter, without taking into account the value of the land; This is unsustainable today. This causes, The house has a minimum price, even if it’s for protection purposeswithout this no organizer can take action to promote it.
No investor will build a single subsidized house if the maximum selling price, known as the module price, is below the margin as well as construction, land and tax costs. This is largely what happened in the Community of Madrid, where the module has not been updated since 2008 and Current construction costs prevent the construction of this type of affordable homes.. Luis Corral proposes a formula to correct this imbalance in the market: “In many areas, officially protected housing (VPO) modules have not been updated for years. This means that while free housing is managed according to supply and demand, the protected person does not move and the competent administrations causes these reported imbalances. Can be solved by adjusting the module according to the reality of each market“First of all, there is no point in buying a more expensive subsidized home with the restrictions it has when it comes to selling, unless the free home meets the conditions,” the executive concludes.