The measure was one of a dozen unveiled on Monday by the country’s prime minister, Pedro Sánchez, as the government seeks to quell mounting anger over housing costs that have soared far beyond the reach of many in Spain.
Sánchez sought to underline the global nature of the challenge, citing housing prices that had swelled 48% in the past decade across Europe, far outpacing household incomes.
“The west faces a decisive challenge: to not become a society divided into two classes, the rich landlords and poor tenants,” he told an economic forum in Madrid.
The proposed measures include expanding the supply of social housing, offering incentives to those who renovate and rent out empty properties at affordable prices and cracking down on seasonal rentals. In Spain just 2.5% of housing is set aside for social housing, a figure that lags drastically behind countries such as France and the Netherlands, said Sánchez.
On the surface it seems like a good idea: if the home isn’t going to be your primary residence you pay extra—a lot extra—to curtail a housing shortage caused in part by foreigners buying and inflating.
That said… if the issue there is anything like it is here in the states, the buyers will have more than enough capital to buy anyways and just pass the cost along to tenants… making the problem worse?
See below, the idea is for rent control to take care of that, which is part of the package. Along with the government supposedly planning to build their own company to compete.
If they were able to manage getting this implemented, which is dubious for political reasons, it probably would work, but it’d take at least a few years and there are many ways the increasingly anarchocapitalist conservative forces around it can disrupt it. We’ll see. As a model for other places… it’s probably a good place to start looking, it just needs a legal framework where you can deploy all of it (rent control, direct government development and rental, fiscal pressure on speculative property purchases). Just one piece alone probably won’t do it.
Rent control is such a poor substitute for building massive amounts of social housing. I wish it would stop taking up oxygen in the debate already so that we can focus on effective solutions instead
You’re literally replying to a comment about rent control being part of a multi-pronged approach, one that INCLUDES building massive amounts of social housing, not a substitute for anything.
Sounds like you want building to be the ONLY prong, which wouldn’t work for anyone except the developers that would get to build and thus profit more.
The bigger issue is that it’s quite easy to “hide” that you are foreign. To do so, simply set up a holding in Spain that buys the house on your behalf.
The legislation being proposed also has a bunch of regulation regarding Spanish holdings buying property, including rent price controls. Depending on how you look at it, forcing foreign groups to set up shop domestically and be restricted by that regulation is the entire point of the tax hike.
Spanish media were reporting recently that some existing rental holdings were starting to dump real estate in response to the rent control, at least in Barcelona.
The bigger problem will be whether the legislation package passes in Parliament, where it needs support from conservative regionalists and then gets implemented at the autonomy level (think states, if you’re American), which is largely controlled by conservatives.