In a move reflecting the Spanish government's seriousness in addressing one of its most complex social and economic issues, Prime Minister Pedro Sánchez announced today a package of urgent and decisive measures aimed at tackling the country's worsening housing crisis. This announcement puts an end to speculation about how the left-wing government would deal with soaring rents and the housing shortage.
Royal decree to expedite solutions
During the inauguration of a massive public housing project on a former military site in Madrid, which is slated to include 10,700 new housing units, Sánchez emphasized that time was of the essence. He confirmed that the new package of measures would be implemented within the next few weeks by royal decree . The significance of this legal step lies in the fact that it does not require parliamentary approval to take effect, granting the government flexibility and speed in implementation that bypasses the usual legislative hurdles, particularly given the current political tensions.
The war on fraud and tourist rentals
The core of the government plan is a broad campaign to regulate the distorted real estate market. "The government will crack down on fraud and the misuse of rental contracts," Sánchez stated firmly. The plan focuses primarily on tightening controls on tourist and short-term rentals , which many experts consider the main cause of rising prices and distorted local housing markets, as landlords prefer renting to tourists for higher returns rather than long-term rentals to local residents.
The measures also aim to prevent abusive practices, such as converting regular permanent leases into temporary contracts to circumvent tenant protection laws, as well as to curb the abuses in the rental of single rooms that have recently become widespread.
Tax incentives and worrying figures
On the other hand, the government is adopting a "carrot and stick" approach; while tightening regulations, it will offer attractive incentives to compliant landlords. Landlords who extend long-term leases without increasing rent will receive a full tax exemption on the relevant rental income, thus encouraging residential stability.
These moves come in response to alarming data from the Bank of Spain, which revealed that the country's housing deficit has reached nearly 700,000 units , an increase of 100,000 units compared to previous estimates for 2024. This figure reflects the enormous gap between supply and demand, which explains the significant difficulties faced by young people and Spanish families in finding affordable housing, making these measures an urgent necessity for social and economic security in Spain.
