The real estate sector awaits with misgivings the approval of the new housing law next Thursday in Congress, after the agreement between the partners of the Government, EH Bildu and ERC. While the notarial group prefers to wait for the final draft to be published in the BOE, the annual rent update decoupled from the CPI, the new definition of great homeownerthe obligation of the landlord to pay real estate commission or the new measures of eviction protection are some of the most controversial elements.
Also suspicious is the fact that each autonomous community can apply the legal framework in their own way. All this means that the new law is born wrapped in a morass of doubts among sales professionals, lobbies, mediators and expert analysts, as well as representatives of tenants in a market in need of solutions but without magic recipes that satisfy everyone.
As regards the tenantsexperts celebrate part of the law, especially the one that will limit rent increasesalthough they recognize that there is a lack of sufficient measures to increase the supply of public housing or mechanisms that counteract the ability of investment funds to promote evictions of families without alternative housing. In addition, it is expected that there will be a real boom in those destined for the season or tourism, which are outside of this regulation. Hence, Podemos claims to include them.
For one reason or another, all the sectors involved see some aspect that they criticize, with the exception of the Platform for People Affected by the Mortgage (PAH), which considers that the agreement between ERC, EH Bildu and the Government opens a way to mitigate the price of rentals and welcomes the reduction of the definition of “large owners& rdquor; to those who have five homes instead of 10 and the shielding of the powers of the autonomous communities. For the PAH, the anti-eviction law in Catalonia prevented between 5,000 and 11,000 evictions.
Instead, for the Union of Llogateres, the regulation of rentals provided for in the law “is a farce.” They consider that “far from lowering prices, the imprecision of the proposal would allow the opposite, that is, that prices continue to rise at a high rate and suffocating the population”. They anticipate that in the face of a restrictive legal framework, rogues will appear to circumvent the limitations, such as raising the rent by passing it off as IBI expenses or hiding information about the conditions of the previous contract.
The general secretary of the consumer organization facua, ruben sanchezconsiders “good news that city councils can apply to the empty houses a surcharge on the IBI of up to 150%”, but on the other hand it is “regrettable”, that there are no measures to control rental prices “of those individuals who buy speculative housingr. In this, the demands of dozens of civil society organizations have not been met, “he says.
Francis Cross He has been the owner since 1992 of the real estate CVM Flats, located in the commercial hub of Fabra i Puig, where it manages rentals and sales. He believes that one of the most important aspects of the law will be the way to apply the reference index and the clarity of the concepts that will influence income. “The problem in recent months has been that the market has also stopped due to the legal uncertainty, waiting to find out how the new law will affect each of the parties, after a year that has been a real madness of rising prices. Those who had a flat at 800 euros automatically went to 900 or 950 in anticipation of the implementation of the limitation. As professionals, it will be up to us to study the law well, tweak the contracts and offer training to both landlords and tenants, “he explains.
For his part, Ferran Font, director of studies at Pisos.com, criticizes that “the new housing law will cause great regulatory heterogeneity in the autonomous communities and therefore will also generate great instability.” In his opinion, “a less short-term housing policy is missing. The law was born with great doubts not only about its viability but also because of its foreseeable lack of effectiveness.”
also doubt Jose Ramon Lefty, general director of the Rental Negotiating Agency (ANA) and believes that the law will not provide effective solutions and that Catalonia is an example of what can happen. “Since September 2020, when rental prices were intervened in Catalonia (until the Constitutional Court annulled that part of the Catalan law), these have risen more than in other autonomous communitiesyes, like that of Madrid, where there was freedom of income & rdquor ;. In his opinion, the new law as it has been proposed “attacks the freedom of the landlords, it will cause the offer to be constrained, which will not be useful at all, because when there is less offer, the prices will rise or fall. they will remain high, no matter how much they are limited, or the increase will move towards other areas where prices are not limited (non-stressed areas)”, comments Zurdo.
Guifré HomedesCEO of Amat Real Estaterecognizes that there is a feeling that it can be a new temporary legal framework waiting for the future government. “In an issue as structural as housing, it is a It’s a pity that there is no minimum consensus within the parliamentary arc and between the autonomous communities”, says Homedes. In his opinion, the main problem of the sector remains unresolved, which is the lack of sufficient supply. people who are already in a rental property will be good law since it will contain the rent they pay, but for those who want to join the rental market (young people, families, etc.) it will continue to be impossible since there is no available supply,” he explains. Another worrying element from his point of view is that “the small investor , who is the one who dominates rental property in our country, will have no incentive either to continue investing or to maintain the investment they already have.”
Critical with the norm is also Vicenç Hernández RecheCEO of Tecnotramit and president of the Association of Real Estate Agents of Catalonia (AIC), which he believes could become “the first step in a interventionist policy that will increase in the future”. Paradoxically, he adds, “the political class campaigns with the word social when housing is the asset that suffers the most taxes and charges throughout its life and the budget item dedicated to rent social is ridiculous.”
From a technical point of view, Arantxa Goenagalawyer and partner of Barcelona Legal Circlehighlights that the new legal framework allows the extension of the rental contract for one year when the tenant is in a situation of economic or social vulnerability, that is, that The term agreed by the parties can be modified without the consent of the owner.. This implies that the owners who rent a property do not decide the term of the contract, but that a longer term may be imposed with the consequences that this may entail if they are not able to dispose of their property.
Also online review, Carlos Saladirector of the legal area of API Cataloniawho managed the public housing policies of the Generalitat between 2011 and 2018, believes that the text presented “contains measures that are more gimmicky than effective” and that “it can benefit people who live rented in the short term, but not to those who intend to access a rental homeand it is in this sense that we are convinced that it will generate frustration”.
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Alejandro BermudezCEO of the consultancy Atlas Real Estate Analyticsemphasizes that one of the key elements of the new legal framework is the determination of the stressed areas, which in some areas such as the Balearic Islands, Malaga, Alicante, Barcelona, Las Palmas or Madrid can represent up to 40% of the housing supply: ” Declaring an area as stressed has implications for investors’ decisions, since forecasts of price increases have great weight when analyzing profitability in financial models.”
From an academic point of view, Carlos Baladoa professor at the OBS Business School and director of Eurocofín, believes that the change in regulation “will generate insecurity and instability, in addition to mistrust because it will affect the profitability that the owners expect to obtain from their investment and also the valuation. As a consequence, the investments or the release of flats to rent on the market may be reversed, which will lead to an increase in prices or, according to the terms of the law, that they become even more tense.”