FILE PHOTO: Protesters hang a banner on a building, as they demand lower housing rental prices and better living conditions in Madrid, Spain, Oct 13, 2024. [Photo/Agencies]
Spain's housing crisis has evolved from a social challenge into a political flashpoint, as soaring costs and property investment reshape cities and threaten to create a two-tier society.
From Madrid to Barcelona, the transformation is visible on every corner, with real estate speculation and a surge in tourist rentals driving out local businesses.
Analysis shared by the El Pais newspaper showed rents have risen 80 percent in a decade, with nearly half of tenants now spending 40 percent of their income on housing.
Typical spending on housing costs is far above the European Union average of 27 percent, according to a recent Bank of Spain report.
Faced with this crisis, the government has now declared a "housing situation emergency".
The issue has dominated Spain's political agenda during the past year, with protests against tourism's impact on housing markets erupting across major cities.
Socialist Prime Minister Pedro Sanchez last week unveiled a 12-point plan to address the situation, including incentives for affordable rentals, stricter rules on tourist apartments, and notably, a proposed 100-percent tax on property purchases by non-EU residents.
The opposition conservative People's Party has rejected the government's "xenophobic" measures and instead proposed tax cuts.
Sanchez blamed the previous government, saying its market-driven approach for the decade up to 2018 had caused devastating social effects.
In comments to The Guardian newspaper, academics analyzing the situation confirmed the severity of the crisis.
"The prime minister used the words 'housing emergency', and I think that's what it is in many ways," said Ignasi Marti, the director of Barcelona's Esade Business School social innovation unit and the head of its decent housing observatory. "The supply isn't there, people can't access housing, and housing situations that just aren't decent have become normalized over the past few years."
While the proposed 100 percent tax on non-EU buyers grabbed headlines, Marti said it was not a real solution.
"It's not going to solve the problem," he said, explaining that non-EU purchases represent a small portion of the market. "And anyway you can't impose that on EU buyers."
The scale of Spain's empty housing stock demands action, said another expert.
"They need to attack the problem much harder and they need to put an end to people buying flats to speculate," said Claudio Milano, a researcher at the University of Barcelona's social anthropology department and an expert on overtourism. He noted that 3.8 million homes, or 14 percent of the total supply, lie empty in Spain.
"That needs to stop now, and then we can start talking about tax breaks. But the fire needs to be put out before we do anything else, and to do that you need a ban on people buying flats for speculation," he said.
Issues with housing have been identified in urban neighborhoods across Europe, including in Paris and London, which are rapidly transforming into tourist havens, pushing long-term residents to the margins as costs rise.
France last year strengthened existing rent control policies and the United Kingdom has implemented measures to increase the supply of affordable housing, including setting targets for new developments to include a percentage of affordable units.
The Guardian reported that in Barcelona's Eixample district, where tourist flats make up one in every 57 homes, residents remain skeptical about the proposals from the government.
"The demand for more public housing hasn't arisen because of an increase in population, but because the housing available is unaffordable, which leads to more evictions and in turn raises the demand for affordable public housing," said Jaume Artigues, a spokesperson for the local residents' association. "It's a vicious circle, but the root of the problem is speculation."
In his speech to parliament, Sanchez noted Spain lags far behind its European neighbors in terms of social housing, with just 2.5 percent of its housing stock designated as social housing, compared to France's 14 percent and the Netherlands' 34 percent.
"If we don't act, European and Spanish society will end up divided into two kinds of people," he said. "Those who get one or more houses from their parents and can spend most of their income on things like education and travel, and those who spend their lives working to pay the rent and who end up as old people who don't own the home they live in."
