The Spanish Army Feels Left Behind With The New Housing Law

New housing policies have been criticised by the voice of the Spanish Army –  Spanish Troop and Sailor Association (ATME). Even in military housing, military personnel frequently have to wait months for housing and are easily evicted if they fall behind on their rent.

A law affirming the right to affordable housing is making its way through the Spanish legislative process, but economic experts and the Spanish Army warn that its interventionist economic foundation will do more harm than good, leaving some vulnerable groups unprotected.

The Housing Law, as it is best known, was approved by the country’s Congress of Deputies on April 27th and contains approximately ten measures aimed at addressing the country’s lack of affordable housing.

According to the law, rent increases, which are permitted on an annual basis, will be limited to 3% in 2024. Currently, rental increases are not permitted to exceed consumer price index growth (CPI). The government will be required to introduce a new rent-specific index the following year, 2025, to govern the percentage that a landlord can increase the rent on a yearly basis.

It also specifies the designation and criteria for “stressed areas,” which are neighbourhoods where rapid increases in rental prices drive tenants out. Rental prices in these areas, which can range from a few blocks to entire regions, can be capped.

The law would also increase property taxes by 150% for owners of more than ten properties (or five in stressed areas) who leave homes empty for more than two years.

Renters who are about to be evicted must be informed of the exact date and time of the pending eviction, and the law would extend the process of evicting non-paying renters or illegal occupants for up to two years. This has been one of the most hotly contested provisions of the law.

It also requires that 30% of new speculative construction in the future be set aside for public housing.

President Pedro Sánchez has promised 183,000 new public housing units, 20,000 of which will be built on Ministry of Defense land.

Spain has Europe’s largest housing deficit, whether renting or buying, and only about 7% of its housing stock is public, compared to 20% to 30% in other European countries. Unsurprisingly, the situation is most severe in the fastest-growing cities, such as Madrid. 

The rental housing situation has deteriorated dramatically over the last four years, coinciding with Sánchez’s presidency. According to data from the real estate website Idealista, rental stock has dropped 28% overall. The drop has been especially dramatic in fast-growing areas like Valencia and Madrid.

This recent drop in rental stock follows a series of trends that have disproportionately impacted the working classes. The 2008 housing and financial market collapse resulted in many evictions and job losses, and the Spanish economy has never fully recovered. It still has high unemployment and low wages because the cost of living never stoped rising.

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In the housing market, vulture funds arrived on the heels of the collapse, followed by apps like Airbnb, which caused an exponential increase in vacation rentals of residences.

In Madrid, areas of the city centre that were ordinary residential neighbourhoods and working-class homes 15 years ago have been transformed by the dual impact of gentrification and ‘touristification.’

Residents who have lived through it have felt violated by speculators, investors, and tourists, if not pushed out by rising rents or touristification of residential properties.

The number of renters failing to pay their rent have increased dramatically, as have cases of squatters occupying homes. According to Spanish law, evicting a nonpaying renter or removing a squatter puts the owner through a legal wringer, and the new housing law is intended to continue favouring the renter or illegal occupant.

According to Spain’s Exceltur tourism association, capping rents in high-demand areas will only increase the touristification of residential areas.

“It may end up exacerbating the problem by providing a strong incentive to move properties from the residential market to tourist rentals, where there are no [price] ceilings,” the association pointed.

The Spanish Army members, through Spanish Troop and Sailor Association (ATME) has been critical of Sánchez’s housing measures. The Spanish Army personnel often have to wait months for housing and are easily evicted if they fall behind on their rent, even in military housing. 

The members of the Spanish Army also have a grace period of only three months, compared to the two years in the private sector. In 2023 alone, 40 Spanish Army soldiers were evicted from properties that the Ministry of Defence owned. 

The proposal still has to go through the Senate but is almost certain to become law by the end of the legislative term. And it will not make life easier for the members of the Spanish Army.

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