Limiting home purchases to regular use? An ignored but legally viable measure.

Barcelona"Is it possible to limit the purchase of homes only for primary residence?" This is the question that prompted a study to analyze the legal viability of a measure that has so far been politically ignored and is inspired by European cities like Amsterdam. The conclusions of the analysis, presented this Friday, are clear: it is legally feasible to limit the purchase of homes when they are not intended as the primary residence of the buyer. But with exceptions.

Specifically, this report, commissioned by the Barcelona Metropolitan Strategic Plan (PEMB)—a private association promoted by Barcelona City Council and the Metropolitan Area—and prepared by jurist Pablo Feu, an expert in administrative and urban planning law and professor at the University of Barcelona, ​​​​details that this limitation is subject to exceptional, territorial, and temporal limitations.

These exceptions, "to ensure the balance and proportionality" of the measure, are as follows: in the case of the acquisition of entire buildings—such as apartment blocks—purchases would be permitted provided all homes were used for regular rental purposes (5- or 7-year contracts depending on the legal status of the owner), and not. And regarding second homes, the measure would allow the purchase of a second home in a different municipality than the one usually occupied, even if it is in a stressed area, provided it is for personal use and not for rental or investment.

"We say that a home could only be purchased if it is used for living or for regular rental purposes," summarized the vice president of the PEMB, Janet Sanz, at a press conference this Friday at the Canódromo, where she announced that they have already requested meetings with the Barcelona Housing Department and the regional government. "All that's missing is political will," she warned.

The Constitution as an umbrella

The report bases the legal viability of the measure on the Constitution. "If it doesn't pass the legal stress test, it's not viable, and if it does, it is," explained Feu, who argued that this public policy is feasible because it exceeds two constitutional parameters: the substance, which analyzes the content of the measure, and the form, which evaluates its jurisdiction.

"For the substance of a measure that limits a fundamental right—the right to property, because it imposes a condition on it—the Constitutional Court requires that the right being limited not be recognizable and also that there be an objective cause justified by a reason of general interest," says Feu.

By causing urban planning dysfunction, regional regulations can intervene in the real estate market, as can city councils, through their urban planning powers. "The rule would be an urgent, temporary rule, a decree law, because it is linked to an exceptional and temporary situation," said Feu, who predicted that it will be taken before the Constitutional Court, but that it is constitutionally protected.

Urban planning, the key to recovery

Feu argued that the current tension in the rental market stems from the 2008 financial crisis, because since then a 20% down payment has been required for the purchase of a home, a requirement that has caused an avalanche of demand in the rental market, and consequently an increase in prices. "As long as there is someone willing to pay a higher price, the market will not stabilize because demand will not weaken and prices will continue to rise," he added.

This, according to Feu, causes an "urban planning dysfunction" because it clashes with the urban planning and growth model, which must be sustainable. Furthermore, Article 4 of the Spanish Land Law states that urban planning is a non-delegable public function in which private entities cannot intervene. "It must guarantee social cohesion and prevent territorial dispersion. And it has been proven that separating the price of rent and purchase from income does not generate social cohesion, because the city is being populated with a resident population with a high income capacity, while those who cannot pay it are leaving," Feu argued. "BK_SLT_LNA~ "Social homogenization is taking place, not cohesion, and there is territorial dispersion. Therefore, this market behavior is entailing a legal violation, and this legal violation is the first cause that the Constitutional Court requests to rule on whether a rule limiting a basic right is or is not constitutional," he concluded. Finally, the fact that it is temporary and territorial means that it does not alter thestatus quo of the right to property, which the Constitutional Court also requires when restrictive measures are applied.