The Government has already approved the bases of the new Housing Law, the regulations that propose greater interventionism in the real estate and rental market, among others. However, there are certain points that real estate experts and agents in the sector do not particularly like that should be pointed out and analyzed.
Price regulation, the most controversial measure
It is the point that has caused this rule to have been extended in time without approval due to the discrepancies between the Government coalitions.
Arantxa Goenaga, lawyer and partner of the law firm Circulo Legal Barcelona, believes that intervening in the market by imposing prices is not the solution, they should provide incentives. Thus, the lawyer advocates a law that “seeks solutions for vulnerable families” and “helps small landlords who are the ones who really own the majority of the Spanish real estate stock”, through “incentives”.
For the lawyer, the measure of price regulation is not the solution, sanctioning is not the way, “it is a mistake to try to limit prices because the market itself regulates itself and according to the existing demand prices rise or fall”, she believes the jurist, who adds that interventionist policies “lead many small owners not to rent or sell.”
In this context, Montse Junyent, head of legal advice of the General Council of COAPI and the Association of Real Estate Agents of Catalonia (AIC), is not in favor of this law transferring the housing needs of the population to the private sector since “it corresponds to the public powers to arbitrate the necessary measures to increase social housing” .
The real estate consultant Eduardo Molet argues that the best price regulation is that offered by the market itself. “The solution to the problems of access to rental housing is through that and through greater public investment in social housing.”
While José Ramón Zurdo, General Director of the Rental Negotiating Agency, expresses on its website that intervening prices in stressed areas will not increase the supply of homes in those areas, but will punish the owners who need these rents, for example to pay their mortgage or to face the payment of a residence.
Peligra el build to rent
Idealista collects the opinion of Javier Garcia-Mateo, partner of Strategy & Transactions of the EY consultancy, who assures that the new legislation promoted by the Government of Spain will cause the new ‘build to rent’ promotions are reduced by 30%, from 28,000 homes to 19,600.
“In economic theory, intervening in the natural pricing mechanism of any market between supply and demand ends up causing a drastic reduction in the available supply in the medium term”
Competences of the CCAA?
The lawyer of Circulo Legal Barcelona, Arantxa Goenaga, has doubts about some of the main lines of this new law, starting with its legality. “The state competence to enact this law is not very clear since the Autonomous Communities are delegated the powers over housing and, therefore, they must be the ones who approve the regulation,” he points out.
The new Housing Law establishes a surcharge of up to 150% in the IBI for cases of empty houses. At this point, the lawyer believes that the fiscal punishment through the IBI to empty homes “is not a novelty” and has already been regulated in the Local Finance Law for some time and yet it has not been applied by the municipalities . Well, it must be regulated by each city council.
For his part, Eduardo Molet considers that the measure of raising the IBI by 150% on homes that are empty it’s outrageous and an attack on property, and will create inequality and injustice between the different regions of Spain. “Being a transferred competence, there will be city councils that will apply it and others that will not, something that will depend on their political orientation. “Ultimately, we are facing an ideological law, not an economic or social law.”
Goenaga sees stimulus measures such as “granting tax benefits to small landlords” as positive, so that, instead of punishment, it has a benefit to put their properties on the market or “the help of 250 euros to young people for 2 years to encourage emancipation ”.