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Daily newspaper for Empuriabrava / Roses / Costa Brava: Spanish government approves housing law that allows the identification of problem areas

CATALONIA / SPAIN: At the Council of Ministers on Tuesday, the Spanish government approved the Housing Act, which allows residential areas to be declared “stressful areas”, where rents are capped and which provides landlords with incentives to lower rents through tax deductions. The text comes after almost a year of stagnation due to the lack of agreement between the PSOE and Unidad Podemos on the regulation of rental prices and amid criticism from housing rights groups denouncing that it contains “highly inadequate” measures that offer no “real guarantees”. From now on, the regulation must go through the parliamentary process in Congress, where it could be amended.

Transport Minister Raquel Sánchez said in a press conference after the Council of Ministers that it was a “historic” law that “fulfilled” the commitments made by the Spanish government. Sánchez defended the fact that it is a “guarantees” law protecting both the tenant and the owner and that it “in no way encroaches on the competences” of the autonomous regions.

Sánchez assured that the law establishes “the right to housing” and establishes it “as the fifth pillar of the welfare state”. The transport minister announced that the bill is urgently being processed in Congress so that it can be forwarded to the House of Commons before the end of the year.

The text leaves it to the autonomous regions to request the declaration of areas of tension on their territory for a period not exceeding three years. In these areas, major landlords, that is, landlords with more than ten properties, must lower rents according to an index that the Spanish government must compile within 18 months of the entry into force of the law.

At the same time, small landlords have to freeze their prices and receive tax breaks if they lower them. The text provides for a reduction of up to 90% of the income tax if the landlord reduces the rent by 5% – originally it was said that the partners had agreed on a 10% rent reduction – and deductions of 70% when the apartment comes on rented to young people between 18 and 35 years of age. The tenants can also apply for a contract extension under the same conditions. The price must also be maintained for new contracts, but there are exceptions.

If the landlord has carried out extensive renovations or offers a contract with a term of at least ten years, the rent can be increased by up to 10%. Polluted areas are those where the cost of mortgage or rent plus utilities exceeds 30% of average household income, or where prices have increased by at least 5% over the past five years.

In addition, the law provides for a reserve of 30% of all developments for social housing and sets a tax for empty apartments through a surcharge on the property tax (IBI), which can be up to 150% and can be levied by the local councils.

Less ambitious than the Catalan law
The state housing law, the first of democracy, mitigates the Catalan law that the Spanish government brought before the Constitutional Court without asking for its automatic suspension. The real estate sector believes that the Spanish government law is more “balanced” than Catalan law due to elements such as tax breaks.

The Catalan rent regulation stipulates that the declaration on the housing market must be renewed for five years and in these areas the rent must be determined according to the reference index of the Catalan housing authority. The government announced that it would “look closely” to ensure that state law does not interfere with its competences.

Criticism from organizations
Organizations that advocate the right to housing, such as the Platform for Persons Affected by the Mortgage (PAH), the Union of Tenants or the Homeless Movement, yesterday, Monday, called for the passage of the law in the Council of Ministers to be postponed until it ” real guarantees “contains. The political groups consider the legal regulation of rents to be “inefficient” and regret that it does not solve the problems of evictions and homelessness.

The Spanish government, together with Podemos, ERC, JxCat, CUP and other parties that advocate sovereignty, has brought an alternative text drawn up by the organizations to Congress calling on these parties to continue to support the text adopted by the Spanish government and to correct.

Tuesday October 26, 2021 10/26/21 8:13 PM

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