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Spain’s Housing Crisis: Tenants Struggle as Rental Costs Surge
Across Spain, a severe housing crisis is gripping the nation, with spiralling rental costs forcing many residents out of their homes. In Madrid, Blanca Castro, a tenant, faces uninhabitable conditions in her apartment as landlords allegedly neglect maintenance, a situation mirroring the struggles of countless others across the country. This crisis is prompting widespread protests and demands for government intervention to ensure affordable housing.
Tenants in Madrid Building Suffer Neglect Amidst Rental Bubble
Blanca Castro, residing in an apartment near Madrid’s Atocha station, describes dire conditions. A gaping hole and constant dripping water plague her kitchen ceiling, rendering it unusable. вынуждены Consequently, she washes dishes in her bathtub and uses a camping stove to cook in her living room. Her neighbours reportedly face similar neglect, claiming the building’s owner ceased essential maintenance after announcing non-renewal of rental agreements.
“The current rental bubble encourages large property owners to displace long-term tenants,” Blanca asserts, “opting instead for short-term tourist rentals or inflated rents.” Despite these challenging circumstances, Blanca and her fellow tenants are determined to remain in their homes, resisting what they perceive as attempts to evict them. The property owners were unavailable for comment.
Skyrocketing Rents Outpace Wage Growth
Five-year tenancy contracts with fixed rents are standard, but central Madrid has witnessed an explosion in housing expenses recently. “To find a comparable apartment now,” Blanca explains, “I would have to pay double or even more than my current rent. It’s simply unsustainable.” Her plight reflects the reality for millions of Spaniards grappling with the consequences of a housing crisis fuelled by soaring rental costs.
While salaries in Spain have increased by approximately 20% over the last decade, average rents have doubled in the same period. Property portal Idealista reports an 11% surge in the past year alone, establishing housing as a primary concern for Spaniards. This situation has ignited public outrage, prompting citizens to take to the streets, urging authorities to make housing more affordable. Nationwide protests are planned, with thousands expected to participate in Madrid and numerous other cities.
Demand Outstrips Housing Supply, Driving Rental Crisis
A report from Spain’s central bank reveals that nearly 40% of renting families spend over 40% of their income on accommodation. Juan Villén from Idealista points to a “significant imbalance between supply and demand” as the core issue. “Demand is robust, the economy is experiencing growth, but housing supply is rapidly diminishing.”
Barcelona serves as a stark example of escalating rental pressures. Five years ago, nine families competed for each available rental property; now, that number has surged to 54. Consequently, rental costs in Barcelona have risen by 60% during the same period, according to Mr. Villén.
Calls for Increased Housing Construction
“We need to construct more properties,” Mr. Villén emphasizes. “And on the rental side, we need to encourage more individuals to rent out their properties or invest in property, renovate them and introduce them to the rental market.”
Government Acknowledges “Social Emergency,” Seeks Solutions
The central government has acknowledged the situation as “a social emergency,” concurring that insufficient supply is a key driver of the crisis. The Housing Ministry estimated last year that Spain requires between 600,000 and one million new homes within the next four years to satisfy demand. Immigration, contributing to Spain’s economic expansion and workforce, has further amplified this need. The ministry also highlighted the low proportion of social housing in Spain, at just 3.4% of the total housing stock, ranking among the lowest in Europe.
Obstacles to Expanding Housing Supply
During Spain’s property bubble peak in 2007, over 600,000 homes were constructed. However, several factors impede current construction rates, including elevated building expenses, limited land availability, and labour shortages. In 2024, just under 100,000 homes were completed.
The government is implementing measures to stimulate construction, allocating land for affordable housing development and aiming to prevent public housing from entering the private market, a recurring historical issue.
Government Intervention and Market Regulation Debated
Prime Minister Pedro Sánchez has indicated a willingness to intervene in the market to control rental prices. At a recent event inaugurating low-rent apartments in Seville, he asserted that citizens “want us to act, they want the housing market to operate based on reason and social justice, not unregulated forces; they want to ensure that speculative investment firms and profiteers are not acting without constraint”.
Crackdown on Tourist Accommodation
Both central and local governments identify short-term tourist accommodation as contributing to the problem. Last year, the Canary Islands, Balearic Islands, and various mainland cities witnessed protests against increasing tourist numbers, with their impact on rental costs being a primary grievance.
Numerous city councils are responding by planning to limit tourist-flat permits. Barcelona is taking more decisive action, intending to revoke licenses for all of the city’s approximately 10,000 registered short-term apartments by 2028.
Rental Caps and Legislative Measures
The Sánchez government has enacted a housing law, including rental caps in “high-tension” areas experiencing uncontrolled price increases. However, political opposition has limited its implementation, currently confined to the Basque Country, Navarre, and Catalonia. The effectiveness of this legislation remains debated.
Socialist-led regional and central governments point to a 3.7% decrease in rental costs in Catalonia’s “high-tension” areas since the cap’s introduction a year prior, with Barcelona experiencing a 6.4% reduction. Conversely, critics caution that the rental cap has deterred landlords, leading to the removal of thousands of properties from the rental market.
Conflicting Views on Market Solutions
Mr. Villén argues that government measures are “counterproductive for landlords,” leading investors to withdraw from the rental market, including those involved in build-to-rent projects.
Tax on Non-Resident Property Purchases
Another controversial government proposal is a potential 100% tax on property purchases by non-EU residents, aimed at curbing purchases of infrequently inhabited homes, a measure potentially impacting British buyers significantly.
The conservative opposition criticizes the government’s interventionist approach as overly aggressive. However, growing public discontent suggests many believe stronger government action is necessary.
Tenants’ Rights Groups Advocate for Rent Reductions and Strike Action
Gonzalo Álvarez, representing tenants’ rights organization Sindicato de Inquilinas e Inquilinos, acknowledges housing shortages but disputes that increased construction is the solution. “The housing shortage exists because homes are being taken over – by tourist flats and empty properties owned by investment funds and banks,” he contends. “The issue isn’t a lack of housing stock, but rather the appropriation of existing homes.”
His organization demands mandatory and substantial rent reductions imposed on landlords and threatens a nationwide tenants’ strike, involving rent refusal, to pressure the government.
“Governments are not establishing limitations,” Mr. Álvarez states. “Therefore, we must take action ourselves.”