The housing law, at state level, will have a greater scope than initially planned in Catalonia, if it goes ahead. The Department of Territory of the Generalitat announced yesterday that it is reducing from “more than 10” to “5 or more” the number of urban properties that an owner must have to be considered a large holder. The label will mean that their homes will conform to a price benchmark that will limit contracts in declared stressed areas, as long as they have at least five properties there, according to sources familiar with the matter. The change and application of zones and limits need the approval of the Central Government so that they can be applied.
With the discount, the aim is to “contain incomes and guarantee the fundamental right to housing”, stated the Minister of Territories, Ester Capella. It aims to “significantly increase” the amount of rents subject to the law, to “put much more housing on the affordable market”. The reduction would add to the framework of the law 51,000 homes of about 6,850 owners who have between six and ten homes, according to a 2020 study cited by the Government. There would be more, because those with five homes, not broken down, are missing.
The owners are skeptical. “The rents will go down, because there is a limitation. Another thing is that there are apartments for rent. The legal insecurity, with Catalonia as the only autonomous body that regulates prices, will cause a withdrawal of investment, a decrease in supply”, says Òscar Gorgues, manager of the Urban Property Chamber of Barcelona.
In any case, a large holder will be that natural or legal person who owns five or more urban properties (in a tense area) of residential use or a built surface of more than 1,500 square meters of residential use, excluding garages and storage rooms The decision comes after evaluating the almost 50 allegations of municipalities and entities in the Catalan memory about the law presented in June, in which the 140 tense zones were communicated, with all the capitals and 81% of the population. At that time it was already said that it was being studied to consider a large holder who had five properties. “It is surprising that of the 50 allegations, only the two that requested to lower the limit to 5 properties, those of Sabadell and Vilanova, have been collected”, highlights Carles Sala, spokesperson of the Official College of Agents of the Barcelona Real Estate and the Association of Real Estate Agents of Catalonia. From the allegations, it is also decided not to consider the promoters of social housing for rent as major holders.
The decision is also based on a study of the structure and concentration in the market. With the Catalan scheme, in tense areas an owner with less than five properties who makes a new rental contract will not be able to raise it above the last one valid in the previous five years, so it would be frozen (although there there will be exceptions, but the previous rent will be taken as a starting point), and a large holder will not be able to exceed a price reference index that the INE must present before the end of 2024. For now it is not known when will apply, if done. If it depended on the Government of the Generalitat, it could be applied this month, Capella assured. The final report has been signed and will be sent “in the next few days” to the Ministry of Transport, Mobility and Urban Agenda for approval. “Catalonia has pressed the accelerator to guarantee the right to housing, because we are in an emergency situation”, he said. Sources consulted point out that doing so now can serve as a measure of pressure in the negotiations to form a government.
In practice, the modification will mean that an eight-story block controlled by one person will be included in the law, Gorgues exemplifies. “The properties are usually concentrated. The choice will be to go to temporary rent and those who have cheaper rents will sell the flats if it doesn’t work out for them”. The modifications were celebrated among the tenants. The Tenants’ Union stated that it will allow further mandatory rent price reductions. They ask, in any case, that the Government approve “immediately” the tense areas so that the law can come into force, because if not “the rents will continue to rise”.
