The Bank of Spain has called on public administrations to pay “particular attention to stimulating the supply of housing”. In a report published on Wednesday, the banking regulator indicated that “the current rigidity” of the rental market “would indicate the need to continue progress in increasing the stock of public rental housing at affordable prices” and in the “design of a regulatory framework which stimulates the supply of residential rentals by individuals and professional agents.
The report highlights that the Spanish economy stands out in the European Union “for the high proportion of renting households who find themselves in a situation of overwork to meet the cost of renting a home.” This “extra effort” is provided when households have to spend more than 40% of their income on paying rent and basic supplies, such as water, gas or electricity. In Spain, almost 40% of tenants are in this situation, compared to 27% of the European average and very far from economies like France and Germany, with around 17.5% of families in this situation. Since 2022, prices have increased by 10 to 15%.
These situations of overwork, indicates the report, “are concentrated in the lowest income groups”. Furthermore, he underlines that the persistence of these high efforts linked to access to rental housing could contribute to the “progressive delay in the age of emancipation” of young people. According to data from the Bank of Spain, households with a 30-year-old as a reference increased from 32.2% in 2007 to 56.6% in 2023, while those with the means to access property fell from 59 to 29 years. %, and young people aged 18 to 34 who are unable to emancipate themselves has increased by 13 points since 2008, to 66%.
In its conclusions, the entity emphasizes that “a high effort associated with housing rental can lead to negative economic and social effects that justify public intervention”. But he warns: “Affordability issues and current tensions in the residential rental market could persist in the face of recent demographic dynamics and the most recent data on housing construction and rehabilitation.” In this sense, the banking authority considers that “the scale of the housing problem” “makes it difficult to envisage” that “isolated short-term” actions will resolve the problem.
Among the range of medium or long-term measures, the Bank of Spain highlights “the need to continue progress in increasing the number of public rental housing at affordable prices” and in “the allocation of resources that could prioritize actions in the most important areas.” vulnerable groups. It also highlights other areas that “affect the housing market”, such as “those linked to the functioning of the labor market, the dynamism of productivity of the economy and tax and transport policies”.
Finally, the report indicates that “the design of public policies should prevent certain initiatives, whose effectiveness could be relatively limited in protecting demand in the short term, from ending up generating significant undesirable effects which hamper the functioning of the rental market in the long term. term “. medium and long term. » He doesn’t cite any, but the previous governor, Pablo Hernández de Cos, had questioned tax incentives for housing. And this warning comes against a backdrop of differences within the coalition government over the youth rent bonus, which some experts consider inflationary.
