Barcelona declared as a:"tense housing area"
On September 15, 2021, Barcelona's City Council declared the city as: "tense housing area".
Once again, we want to emphasize from the private sector we are prepared to cooperate with the public sector in the search for viable and lasting solutions to overcome the problem of access to housing.
Finques Feliu gives you the keys on the new scenario.
1. Why does the difficulty of access to housing arise?
There are two main causes (we will not consider policies because this article gives information instead of opinion):
a) The different pace of evolution between salaries and housing prices (together with job insecurity).
b) The Inflation percentatge which accelerates the initial difference between salaries and housing costs.
The impossibility of calculating inflation rate accurately is at the core of the problem. If it were possible, economic agents would have "perfect information" to adjust - or not - their behavior to the expected price variation.
2. What is the scope of the problem?
It is global, however its impact is local.
3. What is the context of the City Council's statement?
Barcelona City Council followed the development and approval of the regulation to regulate rentals in Berlin. The German city-state regulation came into force at the end of 2020, but was declared unconstitutional in April 2021.
4. In Spain who rules housing policy?
The three levels of government. Which are, as follows: Central state, Regional level and Townhalls.
5. Is the rise in housing prices in Spain homogeneous? What is public opinion in Madrid and Barcelona demanding?
No. There is a clear divergence between the evolution of Madrid and Barcelona and the rest of the localities.
In Madrid and Barcelona there is a demand for a public policy that is effective in the medium and long term, as well as quick in its short-term effects.
However, the "immediate" times demanded by citizens and the media are contradictory to the "gradual" times necessary for a public or public-private policy to be as successful as we all want it to be.
6. What characteristics must a locality satisfy in order to be declared a "tense housing area"?
Three:
"a) That prices with rises clearly higher than the average for Catalonia are registered.
b) That in these areas families spend more than 30% of their income on rent.
c) That the price of rent has risen in five years three points more than the Catalan CPI".
This was established in the Catalan Law of Rent Containment -of September 2020- A year ago the city council of Barcelona expressed its willingness to use this legal possibility.
7. What does the declaration of Barcelona as a "tense housing area" imply?
For five years period, new contracts can be priced up to 5% below the rental price index.
Important: the 2020 Law is currently under appeal, so the declaration of "tense housing area" may be legally abolished in the future. From Feliu we emphasize that, as long as it is in force, as it can not be otherwise, we will obey the law.
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