The Spanish government prohibits investors from buying apartments below 70% of the market price

MadridAfter hours of very intense negotiation, the PSOE and Sumar have reached an agreement in extremis within the Council of Ministers to approve a package of housing measures. "The effort was worth it," proclaimed the Minister of Housing, Isabel Rodríguez, in the subsequent press conference, despite the lack of agreement among the groups of the plurinational majority. They have until Friday to secure their support, because that is when the regulations must be voted on in an extraordinary plenary session in Congress requested by the Spanish executive. In fact, Moncloa trusts that social pressure on the streets will sway the groups towards a yes. "The context is a window of opportunity," executive sources assure. One of the main novelties is the limitation on the purchase of homes by investment funds: according to the text of the decree-law, to which ARA has had access, a private entity is prevented from buying apartments below 70% of the market price value, but with limitations.

"Any entity with legal personality or without that has as its corporate purpose the acquisition of real estate," the text says. However, it makes exceptions: if the destination of the housing purchase is to offer it at an affordable or social price for a minimum term of five years; if the purpose is for people in need of social-health care to live there; or if they are to be managed by third-sector entities or for victims of gender-based violence. At the same time, public entities are excluded from these limitations, as well as private ones that adhere to the administration's code of good practices in housing matters, and also if the property is obtained as a result of a judicial or mortgage foreclosure.

Another novelty is the regulation of room rentals. It will be required to demonstrate that there is a real need to have this type of contract and, in the event that this is not the case, the contract automatically becomes one of habitual residence. In addition, its price is limited: the rent for all the rooms cannot exceed the price that the property as a whole would have according to the reference price index of the Ministry of Housing. It introduces, in any case, a safeguard for Catalonia, which already has this issue regulated: the regional regulations will continue to be applied.

All measures are taken in a context of maximum social mobilization following the eviction last week of the 87-year-old woman Maricarmen Abascal in Madrid. For this reason, it is even referred to in the explanatory memorandum of the housing decree-law. "This decree-law is a broad package of structural measures that introduce changes to the legal system to provide guarantees for the constitutional right to access housing [...]. These are measures that have broad social support [...]. If public administrations close off any prospect of action on redistribution, social justice and the modification of the legal system [...] it represents a social and institutional failure, like what happened in the case of Maricarmen Abascal".

The two decrees

The PSOE and Sumar have decided to divide the measures into two different decree-laws.

A first decree-law that includes measures requested by both the left and Junts and the PNB, with the doubt being whether it is viable for all of them to go forward at once because there may be cross-vetoes. Aside from the limitation on the purchase of housing by vulture funds and the regulation of room rentals, the first decree-law —which has already been published in the BOE— includes the extraordinary two-year rental extension; a maximum 2% annual increase in the rental price when it is time to update it; and the halting of evictions for vulnerable families, with exceptions. This may be a point of contention with Junts, since it has already defeated this measure previously in Congress and demands a distinction between small and large property owners. According to the draft to which ARA has had access, evictions may be carried out if the owner is also in a vulnerable situation if they stop receiving rental income or is a natural person with fewer than two properties. Tax incentives demanded by the Junts members are also introduced: strong deductions when taxing rental income in the personal income tax (IRPF), which can be up to 100% if one is not a large property owner and the contract is renewed after five years with the same tenant and with a reduction of at least 5% of the price. Also, if one is a small property owner (up to 10 homes) and the property is rented for the first time and the initial rent is below the reference price index of the Ministry of Housing.A second decree law that goes further and establishes indefinite rental contracts, a request from the Tenants' Union that had also been adopted by Sumar as well as Podemos, ERC, Bildu, Compromís and the BNG, and which has been the point of contention with the PSOE until the end. This second decree will not be published in the Official State Gazette until this Thursday.

Friday vote

The vote will take place on Friday in the Congress of Deputies, because the Spanish executive has requested an extraordinary plenary session, also taking advantage of the pressure on the streets, especially at the Puerta del Sol in Madrid, where the encampment continues. The Spanish Prime Minister, Pedro Sánchez, has called for the approval of this "ambitious" package. In a video posted on X, he argued that the housing decree laws allow for "building a sufficient parliamentary majority to combat the housing emergency." Thus, he appealed to the left-wing and plurinational parties, since he admitted that he cannot "expect anything" from the PP and Vox: "We have listened and we have acted. Now it is up to the groups to do their job. I ask that you be empathetic to the citizens and prioritize the interests of the people over those of the speculators.".

To understand the difficulty of squaring the circle, one only needs to explain the behavior of the Sumar ministers. They have decided to hold a press conference parallel to the official one at La Moncloa to qualify their position. The Minister of Social Rights, Pablo Bustinduy, has said that he rejects the tax breaks, which were a demand from Junts and were included with the desire "to reach an agreement." He also explained that the five Sumar ministers wanted a single decree-law and for the automatic renewal of contracts to be included in the same package –reports Martí Odriozola.

Precisely, the fact that the measures are separated into two different packages drives Podemos away. "It's a mockery," asserted the general secretary, Ione Belarra, who has not clarified her vote. For their part, Junts does not clarify what it will vote either and asks for time. For Gabriel Rufián (ERC), on the other hand, the meaning of the vote is clear: yes. Despite considering them insufficient, he believes the measures are "useful" and already directly questions Junts: "Why does Junts vote in a self-destructive way if it is falling week after week in the polls?", he asked.