Limit the purchase of houses if it is not to reside in them in areas where the real estate market is “excessively stressed” or there is no space for the construction of new properties. This is one of the proposals included in the bases of Yolanda Díaz's political project that will be the wickers of her electoral program and that is proposed with the aim of protecting tenants from “rapid rent increases.”
In practice, the measure sponsored by Sumar – the brand with which the Vice President of the Government will attend the general elections at the end of the year – could be applied in all large cities and would affect approximately six out of 10 Spanish households according to the Law of Housing approved on Thursday in the Congress of Deputies. The justification that appears in the chapter dedicated to this subject, which Javier Burón, Barcelona City Council's Housing Manager, has elaborated, is that the restrictions on the acquisition of flats are already applied “in some places in the European Union”, but without specify with what result.
The aforementioned law, which will foreseeably come into force before the municipal and regional elections on May 28, establishes two new criteria to consider that an area is “stressed” which, in addition, are individual. In other words, it is enough that one of the two is fulfilled for the area to acquire said consideration.
On the one hand, that the average rent or mortgage charge (including basic expenses and supplies) exceeds 30% of the average household income. And, on the other, that the rental or purchase price has exceeded inflation by at least three points in the previous five years.
61.09% of Spanish households meet at least one of these two premises. Specifically, according to the Atlas Real Estate consultancy, which applies data science tools to the real estate market, it calculates that some 2,298 postal codes would be affected by this new regulation, in the 52 provinces.
If we go down to specific territories, the impact is even clearer: of the 179 geographical areas that the province of Madrid has, 59% of them would be affected, reaching a total of 2,738,121 million inhabitants, 85% of its population. In the case of Barcelona, of its 198 areas, the law gives a stressed condition to 52.5%, in which 2,089,560 million inhabitants live, 80% of the total.
Outside of the large ones, practically the entire population of the Balearic Islands (95%) or Malaga (94%) would also live today in a stressed area, according to the new official criteria.
In addition to the limitation on the purchase in these areas, Díaz's team wants to increase the minimum duration of rental contracts in general -currently it is five years- and sets the goal that most of them are indefinite “with exceptional causes of termination ». It also outlines the possibility of granting the right to use a home “for life” for older people.
Variable rate mortgages
Another of Sumar's proposals is to “make it difficult” to grant mortgages at variable interest rates, which account for a quarter of those currently contracted, and to “stabilize the purchase and sale market” through fixed-rate mortgages.. In parallel, it proposes to review the legislation on the subrogation conditions for changing the bank loan, the alternative modalities to property in horizontal division and dation in payment when an asset is delivered to settle a debt without going into the details of what would be the change.
Among the most controversial issues that are put on the table is that of “facilitating access to housing for people in an irregular administrative situation”. The measure is dispatched in a single line in which no details are specified on whether it would be applied with certain requirements.
The bases of the project of the also Minister of Labor suggest “introducing into the public debate” the need for a tax on the surplus value of the land, which in principle would be applied to the land available for construction “when they remain idle”. In this case, it does specify that a model similar to the Anglo-Saxon would be applied because it is “the only neutral tax”, which “does not affect savings and investment decisions” and whose “high tax collection capacity” would allow “alleviating the burdens” of others tributes.
Likewise, it proposes to suppress any tax benefit for companies or individuals dedicated to the management of real estate that own more than 100 homes. The exception to this rule would be that they dedicate a minimum of 25% of these properties to “social and affordable rental” at the price and under the conditions set in each autonomous community for officially protected flats.
In the same line of differentiated taxation, Sumar proposes that the amount of the Real Estate Tax (IBI) receipt vary depending on the use that is given to the property to which it is taxed: that is, that it be taken into account if it is a primary or secondary residence; whether the rental is long-term or short-term; if the house is empty or not; and if the rental price is protected or free market.