It was José Luis Arrese, Franco’s housing minister, who summarized in 1959 the basis of the house model known in Spain until four days ago: We do not want a Spain of proletarians, but of owners.
Since then, rent has been reserved for students and migrants, poor people waiting to access the sacrosanct ownership of a house through a bank loan. But this is starting to no longer be the case.Not socially, nor as an aspiration, but increasingly, in practice. Renting has not gained prestige, it continues to be the alternative for those who cannot afford to buy a house, yet more and more people live as tenants in a place that does not belong to them.
At least in the spanish market there is a notorious contradiction. The installments of an ordinary bank loan are lower than what it costs to rent an apartment; Though, to access a loan it is indeed necessary to advance between 20 and 30 percent of the value of the house. Here’s a circle of hell: People who can’t access a loan to buy a house are forced to pay more monthly to rent an apartment, wich in turn makes it arduous for them to save anything to access a property.
The problem, in case someone ventures here, is not the difficulty of having access to a mortgage. Conditions rightly tightened after the 2007 crisis, when the housing bubble burst, thousands of people were unable to pay thier loans and were evicted. The problem, don’t be fooled, is the price of houses in general, and rents in particular, which has done nothing but rise in the last decade. It seems that the free market makes things worse.
Owning a home is not a right; There are perfectly practicable, and perhaps fairer, models based on public rental housing. What is a right is having a roof over your head that you can call home without having to spend half your salary and without fear of being kicked out any day now. In the Spanish case, this is recognized by the Constitution itself, which in article 47 theoretically protects the right to enjoy dignified and adequate housing.
But for some time now the free market has clashed head-on with the guarantee of this right, and it is clear that the apparently progressive government is incapable of reacting. The problem, in any case, is global, because the financial circuits that have found in the real estate sector a safe value in which to make profitable investments at the expense of tenants are global, but the crisis takes on its own characteristics everywhere, and in Spain it is about to provoke a wave of indignation with uncertain derivatives. the massive demonstrations that took place in numerous cities in October are a first warning. The one held in Barcelona on November 23rd with almost 200,000 participants was a second wake-up call.
A recent study by the Barcelona Urban Research Institute has provided figures and ideas to this crisis. On the one hand, the number of people living in rent is growing: the majority are now between 16 and 29 years old (53%) and almost a third (32%) are between 30 and 44 years old. The percentages are much higher among the migrant population, and the majority of those who live on rent have no confidence in inheriting a house, which disproves one of the myths used to fight the crisis: you live on rent until you inherits his parents’ house. Many times this is not the case.
On the other side of those who cannot buy a house, there are those who can always buy more. Nearly six in ten sales are made in cash, without the need for a mortgage, and 15% were made by non-resident foreigners. Between 2008 and 2020, almost half of the homes registered came from companies with more than eight properties. Income has become a major vector of social inequality, as it only transfers income from the poor to the rich.
The simple clarification says that there is an excess of demand and a shortage of supply, which is why it is indeed proposed to build more. There will be specific places where it will be a necessity, but by now we should have learned that brick is not the solution in the sixth-highest number of homes per capita in the entire OECD.
You don’t actually have to invent anything. There are model countries and cities in Northern Europe such as Vienna and Singapore that teach how to organize the sector to protect the right to housing: an notable stock of public rental housing and a reasonable limit on the maximum benefit that an individual can obtain from owning property , but you don’t have to go far.
It would be enough for the “progressive” government to continue reading article 47 of the Spanish Constitution: The public authorities will promote the necessary conditions and establish the relevant rules to make this right (to housing) effective,regulating the use of land according to the general interest in preventing speculation.
how do current housing policies in Spain impact social mobility for younger generations?
Interview between Time.news Editor and Housing Expert
Editor: Welcome, and thank you for joining us today to discuss the changing landscape of housing in Spain. Your expertise is invaluable as we navigate these complex issues.Let’s start with a ancient outlook. Why do you think the housing model established in the late 1950s, particularly the idea of “a Spain of owners,” has persisted for so long?
Expert: Thank you for having me. The notion introduced by Franco’s housing minister, José Luis Arrese, was deeply ingrained in the Spanish psyche, promoting the idea that homeownership equated to stability and success.for decades,this belief shaped policies and societal values,pushing people towards ownership as the ultimate goal—associated with status and security. However,this model has overlooked the changing economic realities and demographics of our society.
Editor: Indeed, as you mentioned, there’s been a significant shift in the demographics of renters in Spain. Can you elaborate on how the perception of renting is evolving?
Expert: Absolutely. Until recently,renting was frequently enough stigmatized,viewed as a temporary solution for students or low-income individuals.However, we’re witnessing a growing acceptance of renting as a viable long-term option, especially among younger generations and those moving to urban centers for work. while it’s still not seen as prestigious, there has been a subtle shift where renting offers versatility and lower initial financial barriers compared to owning a home.
Editor: You highlight an significant contradiction in the current market: that monthly rent can often exceed mortgage payments. Can you explain this paradox further?
Expert: Yes, it is indeed perplexing. With mortgage rates remaining relatively low, the monthly installment can often be more affordable than renting. However, the stumbling block is the requirement for a substantial down payment, typically between 20-30% of the property’s value.This creates a vicious cycle—those who cannot save for the down payment frequently enough end up paying more to rent,which makes it even harder to save. It’s a form of economic entrapment.
Editor: Considering this cycle, what implications does it have for social mobility and economic equity in Spain?
Expert: The implications are profound. As more people find themselves locked into a renting situation, the dream of homeownership becomes increasingly unattainable. This affects not only individual financial health but also broader economic stability. Young families may delay having children or settling down, impacting demographic trends. Moreover, the struggle for affordable housing can exacerbate tensions in urban areas, leading to a growing divide between property owners and renters.
Editor: What are some solutions or alternatives that policymakers should consider to address these challenges?
Expert: Policymakers need to recognize the necessity of diversifying housing options. This includes increasing the availability of affordable rental units, promoting long-term rental contracts with protections for tenants, and possibly revisiting financial mechanisms that assist first-time homebuyers without crippling them financially. Additionally, fostering cooperative housing models or community land trusts might offer innovative ways to stabilize housing markets without traditional ownership pathways.
Editor: This discussion highlights the complexities of the housing market in Spain, and it’s clear that the paradigm is shifting. As we wrap up, what do you think the future holds for renters in Spain, and what should individuals be aware of moving forward?
Expert: The future is likely to see more acceptance of renting as a cornerstone of modern living. However, individuals should remain vigilant about their rights as tenants and advocate for policies that promote fair housing. Staying informed about local initiatives and being part of the conversation around housing can empower renters to demand changes that create a more equitable habitat. It’s about reimagining the relationship we have with our living spaces in a way that caters to evolving needs and circumstances.
Editor: Thank you for sharing your insights today. The conversation about housing in Spain is evolving, and it’s crucial that we continue to engage with these pressing issues.Your expertise offers a valuable perspective on what lies ahead.