Real estate experts and housing researchers share concerns about a proposed renewal of housing legislation, arguing that certain measures may unintentionally dampen investment by restricting rental prices. The Housing Observatory at a leading polytechnic university and Valencia area real estate professionals warn that price caps could shrink the current market supply, mirroring effects seen in other regions that have limited rents, such as certain European cities. They advocate for a long-term strategy that expands protected rental housing through public-private cooperation, including projects on publicly owned land. In these initiatives, developers receive regulated rents for a defined period before properties transfer to the administration.
News
The key changes anticipated in the rental law include a linkage of future price adjustments to a new index, aiming to keep rent growth in line with inflation; a halt on new contracts in densely populated areas where about three-quarters of households in Valencia province reside; and stronger safeguards against evictions. Simultaneously, the government indicated that Sareb, the state asset manager created after the real estate market collapse, will be released into the residential rental market held by public agencies. This shift is seen as a potential way to increase the stock of affordable units. Source attribution: UPV Housing Observatory and governmental briefings.
The average price for a 70-square-meter home in Valencia has reached around 1,500 euros, according to market observers. Fernando Cos-Gayón, president of the UPV Housing Observatory, acknowledges that rents are high but questions whether the measures will stop prices from rising. He stresses that price caps have not proven effective anywhere and may simply delay the broader effort to reduce rents. Source attribution: Fernando Cos-Gayón, UPV Housing Observatory.
Cos-Gayón argues that subsidized housing on public lands, delivered through public-private partnerships, is a more viable path. Vicente Díez, spokesperson for the Valencian Association of Realtors, concurs that increasing the stock of protected rental housing is essential. He notes that there is no short-term solution and that including Sareb properties in the rental market could help, though only to a limited extent. He adds that more land must be made available to support new rental housing projects. Source attribution: API spokesperson, Valencian Association of Realtors.
Díez emphasizes that the Valencia metropolitan area could build rental supply on public lands through concessions. He describes a model where a project owner can receive a concession for a number of years, similar to arrangements used for parking lots, at an affordable cap, ultimately expanding the rental housing stock. This approach aims to improve the overall availability of rental flats. Source attribution: Vicente Díez, API.
Insecurity
Nora García, president of the Association of Real Estate Companies of the Community of Valencia, argues that the Housing Act may discourage investment. She notes that about 70 percent of their clients are small savers who rent one or two properties, often inherited or purchased through work and used in retirement income. She believes these measures encourage owners to sell, creating distrust in the rental market. Source attribution: Asicval statement by Nora García.
In parallel, major Spanish tourism companies have pressed the government to regulate the proliferation of illegal tourist agencies. Through ongoing discussions with officials, they seek national legislation to enforce local regulations that currently face compliance gaps, aiming to curb the growth of tourist-occupied housing rented by the day. Industry players warn that traditional rental apartments are increasingly being converted to tourist platforms like Airbnb. Source attribution: Industry lobby statements.
The tourism lobby, representing the thirty largest industry players including major hotel brands, urges the government to leverage the Housing Act to address illegal listings. They express disappointment that the proposed regulation, crafted by coalition partners and regional parties, does not explicitly address tourist rentals and warns of unintended consequences of the current text. Source attribution: Industry coalition statements.
Jose Luis Zoreda, vice president of Exceltur, stresses that the future Housing Act should not exempt housing from tourist use; otherwise, the effort to promote affordable rents could be undermined. The lobby argues that price caps in city centers may inadvertently drive more properties into tourist rentals. Source attribution: Exceltur leadership remarks.