Since its entry on the scene and subsequent implementation, the new housing law of 2023 has been the great protagonist. Despite the fact that all of its measures generated – and continue to generate today – debate in society, one of them has sown greater uncertainty.
It is about the modification of the definition of the big fork. But what exactly changes? The experts from the comprehensive real estate services platform Housfy explain it in the following lines.
More than three years of negotiations have had to pass so that, finally, on May 25, 2023, the Law for the Right to Housing came into force. A regulation that brings with it some confusion in relation to an apparently simple but significant change: the modification of the meaning of the concept of large holder.
However, it is not a complete reform of the concept, as many tend to think. We are only talking about the new possibility that the autonomous communities have to broaden the meaning of what it means to be a great fork.
The definition of large holder could be seen for the first time in the Urban Leasing Law (LAU) approved in November 1994. Said law, they explain from Housfy, established the basic definition and the essential criteria that would serve to identify a natural or legal person like a big fork
Now, the new law takes the definition published in Royal Decree-Law 11/2020, of March 31, which adopts complementary urgent measures in the social and economic field to deal with COVID-19. In this, the concept of large holder was defined as that individual or legal entity that owns more than 10 urban properties (which translates to 11 or more), excluding garages and storage rooms. Any holder of a constructed area of ??1,500 square meters or more was also included.
As a basic norm, these urban properties had to be destined for residential use.
Under the main objective of the new Law for the Right to Housing – the increase in the regulation of the real estate market and, especially, that of rent – ??lies the key change. From now on, the CC. AA. that modify the number of properties necessary to be considered a large holder may reduce the threshold to 5.
This adjustment may only be applied in areas with a stressed residential market. Thus, in the rest of the areas that are not stressed, the large holder will continue to be an owner with more than 10 homes.
What does this mean? The most important thing is to be clear that these two definitions hold. That is, the new one does not cancel the existing one. It just opens up to CCs. AA. a door to the extension of the definition, provided that they establish it in the supporting report for the declaration of areas as a stressed residential market, which is required by Law 12/2023.
To contextualize, from Housfy they explain what is meant by a stressed residential market area. The autonomous communities declare a stressed area if it meets at least one of these requirements: the cost of rent or mortgage exceeds 30% of the average household income, or prices have increased three points above the CPI in the last 5 years.
When it comes to a big fork and the new housing law, not everything goes. In the regulations that have just been installed, a large holder is any owner whose number of properties in a stressed area exceeds the threshold established by each community, with 11 or more homes at the moment.
But what happens if the owner only has a percentage of the property, for example? The law does not contemplate divisions, so a property will count regardless of the percentage that it has as owner.
However, it is important to note that not all properties are accounted for in the large fork classification. Properties intended for non-residential use, such as garages and storage rooms, are excluded from this category, exemplify the experts from the comprehensive home platform Housfy.
The changes in the figure of the one that includes the new housing law are not reduced only to the number of owned homes.
In the areas declared to be in a stressed residential market and when the owner is a large holder, the rent agreed upon at the beginning of the new contract may not exceed the maximum limit of the applicable price according to a system of reference price indices, still to be defined at the national level. state. Some autonomous communities, such as Catalonia, already have their own price index system.
Owners who are not large holders will also face restrictions on price increases for new rental contracts. For them, the price may not exceed that of the previous rent, beyond the annual rent update clause that the previous contract had provided. However, an increase of up to 10% may be applied to homes where energy or accessibility improvements are made, or rental contracts of ten or more years.
Finally, the housing law also innovates in evictions, with new legal measures to make it difficult for economically vulnerable people to evict. Changes that will be stricter with the large fork, only allowing an eviction when it shows that an attempt has been made to reach a possible solution with the tenant.
