One year has passed since the Government set a ceiling of 2% on the rise in the rental price. A limit that keeps rents in large cities at all-time highs and with less supply because many owners have taken the opportunity to sell their homes or have simply preferred to withdraw them from the market, say sources in the sector.
The measure, which the coalition Executive is considering raising to 3% within the framework of the housing law, has stopped moving some 1,500 million euros in rent payments that have been updated with inflation, has calculated the administrator of Solfinc farms.
In the sector they agree that the main consequence of the measure is that the owners have raised the prices in the new contracts to compensate for this limitation, which only affects annual updates. According to data from the Idealista real estate portal, the average rental price of a home in Spain has risen by close to 9% in the last year (from February 2022 to the same month of 2023), which is the maximum in its historical record.
The price goes up and the offer goes down
The alarms go off because in the most stressed markets the increases are skyrocketing: Malaga (23%), Barcelona (20%), Valencia (19%), Palma (18%) and Madrid (11%). For its part, the available supply fell by 17% on average in 2022 and up to 32% in Madrid and 28% in Barcelona, the two sources where demand is concentrated.
The general director of the Rent Negotiating Agency, José Ramón Zurdo, explained to EFE that “some owners, to compensate for the limitation that they are being imposed of not being able to update their rents above 2%, have decided to raise the prices of rents so as not to lose power, because the current situation of inflation has also reached them”. Lefty confirms that “many dores are deciding, at the end of their contracts, or not to rent their homes anymore, or to sell them.”
According to his data, in the last year the causes of need alleged by owners who want to recover their rented home before time have increased: “This type of behavior is taking place more frequently, but we don’t know if it is moderate, but if we are noticing that is growing”.
Inequality between tenants
The director of Studies at Fotocasa, María Matos, stresses that the measure has provided a “respite” for tenants who already had a contract, but that at the same time it is “making it difficult for future tenants who are in the process of search, having contracted the offer”.
From pisos.com its director of Estudios Ferran Font the price increase”.
Font agrees that “the basic problem lies in the prices of rental housing that is now on the market, whose rise has made it difficult, and continues to make it difficult today, for many people to access.”
Asval’s claims
The deputy general director of the company specialized in rental investment Masteos, Beatriz Toribio, is also convinced that, after a year of application, the measure “has not served to improve the root problem of this market, which is the lack of supply, but quite the opposite”, since in his opinion it is affected, together with other interventionist measures, to “legal certainty”.
Ángel Martínez León, member of the General Council of the COAPIs of Spain, recalls that the profile of the lessor in Spain is heterogeneous and that, “although the large holders, mostly investment funds, the measure does not affect them, it does does to small owners, who are the most affected, since they do not have much profit margin with the rental of their assets”.
Along these lines, the Association of Rental Housing Owners (Asval) presented contracts in 2022 to the Ministry of Transport, Mobility and Urban Agenda a few days ago.
Asval, an association chaired by former socialist minister Joan Clos, calculates that during the time the measure will be in force, from April 1, 2022 to December 31, 2023, each owner will lose an average of 2,000 euros per rented home.
Cap of 3% in 2024
The latest census of the National Institute of Statistics (INE) indicates that some three million homes rent in Spain, although other sources such as the consultant Savills raise the figure to 4.5 million homes rented, of which they calculate that 5% are in the hands of institutions.
Although considering it “timid”, the tenant unions defend that the measure has saved thousands of millions of euros for tenant families and they want it to be incorporated into the housing law, which would be articulated, as in the decree a few years ago. year, linking the year-on-year increases to the Competitiveness Guarantee Index (an index that never exceeds 2%), instead of the CPI.
The last proposal of the PSOE, through the Ministry of Economic Affairs, to its parliamentary partners in the negotiation of the housing law, was, however, a ceiling of 3% the first year and that after that the limit is determined by an index of prices for elaborated, which United Podemos rejected and keeps the processing of this law bogged down.