Spain has been dragging "structural deficiencies" in its housing policies for six decades, according to an analysis by the Francisco de Vitoria University (UFV), which estimates that the social housing stock barely reaches 2.5% and proposes a package of measures that encompasses tenants, owners, and developers.
The UFV points out in its statement that "Spain has been reforming rental housing for 60 years without managing to stabilize it" and advocates for intervening "at the same time" on social housing, private supply, tenant protection, and construction to "correct an imbalance that isolated measures have not resolved."
The study, based on fractional integration techniques and the evolution of rental prices between 1962 and 2024, detects "very persistent disturbances" in rents and concludes that this persistence barely varies even under very different regulatory frameworks.
The authors emphasize that "neither the measures related to supply nor those related to demand have managed to stabilize rents in the long term" and classify the mismatch in the rental market as "structural," which is why "isolated measures are insufficient."
In this sense, they describe "a structural imbalance between supply and demand, which requires action on four fronts at the same time": sustained increase of social housing, incentives and legal security for landlords, stable protection for tenants, and reduction of barriers to construction activity.
The work notes that "the results reveal that regulatory interventions have not achieved consistent long-term price stabilization and that disturbances in rental prices have persistent effects. It is noteworthy that changes in fiscal policy in 1999 temporarily influenced demand, but no significant and lasting impact was observed in the rest of the regulatory measures."
The researchers conclude that these findings highlight "the structural deficiencies of housing policies in Spain, characterized by the lack of effective incentives and protection on the supply side, as well as inadequate measures on the demand side" and call for comprehensive policies that combine tax incentives for owners, expansion of social housing programs, and greater protection for tenants.
Spain, lagging in social housing compared to Europe
In terms of social housing, the UFV team estimates that in 2020 Spain had "barely" 2.5% of social housing stock, far from the 30% of the Netherlands, one of the reference countries included in the comparison.
"Spain is at the tail end of Europe in promoting social housing, and that cannot be fixed with royal decrees, but with years of policies aimed at ensuring a sufficient supply of housing at affordable prices," says the legal expert in real estate taxation Sofía Borgia.
The report also concludes that the existing tax incentives and legal guarantees "have not been sufficient to encourage more owners to put their homes up for rent," which is why it calls for a "significant" increase in supply to sustainably contain rent increases, reminding that, according to the Bank of Spain, nine out of ten rental homes belong to individuals.
Furthermore, the authors request "stable" protection for tenants and "fewer obstacles to building," which, in their opinion, involves reforming urban planning regulations and "reducing the bureaucracy that hinders construction."
Rent Caps and Risks to Supply
Regarding price caps in pressured areas, the analysis clarifies that it is still not possible to evaluate them, as the data series ends in January 2024, before their implementation in Catalonia and the application in March of that year of the first limits of the 2023 Housing Law.
Therefore, the study concludes that with the available information it is still "not possible to know if the caps work or fail," although it sets their monitoring as a "priority" as soon as enough years of data are accumulated and warns that the caps "may moderate increases in the short term, but without measures to maintain supply, they may push some owners towards tourist rentals, seasonal rentals, or sales."