More than two years after the first 130 municipalities were officially declared tense market areas (and, consequently, rent caps came into force), experts do not agree on the usefulness of the measure. The manager of the Chamber of Urban Property of Barcelona, Óscar Gorgues, considers that "it cannot yet be convincingly and definitively demonstrated that prices have been contained thanks to the measure". On the other hand, the researcher at the Barcelona Urban Research Institute, Jaime Palomera, argues that there is an "unbeatable statistic": the Incasòl numbers, based on the deposits made by the signing of new contracts, "show that there has been a clear price containment effect".On the one hand, for Gorgues, the measure "has more shadows than light", because "the supply of rental housing has fallen" and, at the same time, in his opinion, this and other policies lead "to disincentivize investment in housing". On the other hand, Palomera assures that "the number of rental homes continues to grow", although "not at the pace of previous years". Nevertheless, he is clear that "today in Catalonia there are more rental flats than ever in contemporary times". The research currently underway at IDRA (the Barcelona Urban Research Institute) "suggests a high degree of non-compliance".
Changes in the list of Catalan municipalities where rent prices will be regulated: 22 leave, 53 are added
The Government has updated the declaration of populations considered a stressed residential market area
BarcelonaUpdates to the list of Catalan municipalities that meet the conditions for applying the rent price cap. The Generalitat has reviewed the declaration of municipalities considered a tense residential market area and has incorporated and excluded several towns: after conducting a study on the housing situation, the Government proposes that 302 municipalities have official recognition that their housing market is tense.
The application will not be immediate: the Generalitat's proposal will go through a public exhibition period, during which allegations can be submitted, and once the definitive list is approved, the Ministry of Housing must give its approval for it to come into force. Although the current declaration is valid until March 2027, the Catalan executive has already started all the procedures now to avoid running out of time. In this case, the measure would lapse, a scenario that the Government wants to avoid.
Although the number of locations that the Government proposes to be part of the tense market areas has increased – until now there were 271 – the population living there has fallen from 7 million to 6.1 million. “This shows that the rent price cap mechanism works to contain the rise in prices,” defended the Minister of Territory, Sílvia Paneque, in a press release this Tuesday.
The Government has opted to keep 118 municipalities within the zone, which concentrate almost six million people, 72.9% of the Catalan population. On the other hand, it has considered that 22 municipalities have managed to meet the conditions that allow them to leave the tense market area. This is the case of Lleida, Granollers or Mollet del Vallès, among others, which together add up to more than 634,000 inhabitants.
On the other hand, there are 53 municipalities that until now were not part of the tense market areas, but which now meet the conditions to be considered as such. More than 255,000 people live there.
What does it mean to live in a municipality considered a tense area?
Tense areas are the government's tool to limit the zones where it can contain housing prices, through the application of rent caps. Firstly, the rent for new contracts may not exceed the amount of the last existing contract, once updated (mostly, based on inflation). Secondly, when it comes to a large landlord – a natural or legal person owning five or more urban properties – the rent may not be higher than the reference index for rent prices.
In parallel to the two basic containment measures, the Generalitat approved last December – when the caps had already been in place for over a year – a law to regulate seasonal rentals and room rentals. These are the two loopholes that some owners had found to impose prices higher than those permitted by law.
Beyond rents, tense areas will also determine where the Government and Comuns want the construction of official protection housing (HPO) to be maximally streamlined, and to override urban planning laws, provided that the resulting flats meet the habitability conditions to obtain the certificate.
When does a municipality become a tense area?
The law establishes that a municipality's housing market is considered tense if, on the one hand, citizens have to dedicate more than 30% of their income to housing expenses – rent or mortgage and basic utilities – or, on the other hand, if the rent or purchase price has increased in the last five years by three points above the consumer price index (CPI, the indicator used to calculate the increase in the cost of living).
The declaration of a tense zone is one of the instruments included in the first state housing law – approved in May 2023– to tackle the housing crisis, although it is the autonomous communities that must apply the measure. Catalonia was the first territory to officially declare a large number of municipalities as tense zones, and it did so in two phases: in August 2023, it applied the classification to 140 locations and, in April of the following year, to 140 more. In total, last year there were 271 Catalan municipalities considered tense zones.
Despite the regulations, the Generalitat has only fined three large holders –that is, owners of more than five homes each– for non-compliance with the regulations, without specifying what the offense was, such as whether it was a violation of the rent cap.
