2023-07-12 19:50:41
More than 100,000 homes they may disappear from the rental market in Spain. It is the warning that they have issued from the Tecnocasa chair at Pompeu Fabra University (UPF) as a result of a study that they have presented on the impact of the housing law on the rental market.
In the opinion of the study authors, the limit on rents in stressed areass (22%) and the legal uncertainty (66.3%) could lead to many owners to withdraw their properties from the rental market and look for other business options. This would mean the disappearance of more than 108,500 homes that are currently rented, or what is the same, the rental offer would be reduced by 11.7% nationwide.
Once the current rental contract has ended, 7.7% of the owners are considering selling the home, while 4% are considering other options, such as leasing for use other than housing, according to the study.
Barcelona and Madrid, the most affected
In the city of Barcelona, the offer would be reduced by 12.6% (24,090 fewer properties), in Madrid, 11.3% (43,113 fewer properties). The most affected areas would be Barcelona’s Eixamplewith a decrease in supply of more than 16%, and the center Madrid, with a reduction in supply of 14.6%. What worries the owners with properties for rent in Madrid the most is legal uncertainty (70.9%), in Barcelona, the limit on rents in stressed areas (63%).
All these data come from the study ‘Impact of the new Housing Law on the rental real estate offer’ which, together with the Report on the housing market, a study prepared every six months by the Tecnocasa Group and the Pompeu Fabra University (UPF) of Barcelona and which already has 37 editions, the latter with data from the first semester of 2023, have been presented at the UPF Campus in Barcelona.
Stability in used housing
Lázaro Cubero, Director of Analysis of the Tecnocasa Group, has highlighted that the price of used housing in Spain stabilizes (with a slight rise of 0.21% in the first half of 2023), and stands at 2,377 euros per square meter.
The highest price is in the city of Barcelona (3,145 euros per square meter), and the lowest in Talavera de la Reina (651). The city of Malaga presents the most significant increase in the first half of 2023, of 8.84%, with a square meter at 1,920 euros. The city of Madrid has a square meter at 2,794 euros.
in relation to mortgage market, the average mortgage in the first half of 2023 stands at 121,782 euros, with a variation of -2.7% compared to the amount of a year ago. The highest mortgage is again in the city of Barcelona (145,883 euros), followed by L’Hospitalet de Llobregat (135,788) and Madrid (130,525). Malaga has the lowest amount (94,471).
rent threshold
The loan to value ratio stands at 68% in the first half of 2023, one of the lowest values in the historical series, which reached 80% in the first half of 2008 and stood at 72% a year ago. fair year (first semester of 2022). The ratio between the monthly mortgage installment and the mortgagee’s income is 35% in the semester analyzed, the maximum recommended to minimize the risk of non-payment of a mortgage and the highest percentage since 2011.
Other data that is in line with the current conservative policy of the banks is that 82% of new mortgagees have an indefinite employment contract (only 5% have a temporary employment contract) and the term of the mortgage is 28 years, far from the 35 years of 2007. Finally, another noteworthy fact is that 63% of new mortgages are for 30 years.
Paolo Boarini, CEO of Tecnocasa, has also highlighted the important change that mortgages have undergone in the last six months. Mixed-rate mortgages have more than doubledgoing from 14% in the first half of 2022 to 30% of the total in the first half of 2023. For their part, fixed-rate mortgages, which reached 83% of the total in the first half 2022, they now account for 51% of the mortgages granted in the first half of 2023.
In the first half of 2023, the average interest rate applied to variable mortgages was 4.92%, and 3.25% for fixed mortgages. Finally, in the analyzed semester, the monthly payment according to the type of mortgage was 620 euros per month for a variable mortgage and 560 for a fixed interest rate mortgage, with an annual increase of 46% and 28%, respectively.
Cubero has also reviewed the rental market. The main conclusion is that the rental price rises in the majority of populations analyzed, the most important being the increases in the city of Valencia (14.3%), Barcelona (11.9%) and Madrid (8.6%). The highest price is in Barcelona (16.5 euros per square meter).
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