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The government of Pedro Sánchez has once again demonstrated its proclivity toward excessive intervention with its new housing plan, which includes 12 measures seeking to reduce housing prices in Spain.
But far from addressing the severe issue of housing access, these initiatives are yet another example of policies that prioritize ideology over pragmatism and results.
Sánchez insists on regulating rental prices in high-demand areas—a measure that, according to experts and studies, ends up discouraging landlords and reducing the supply of available housing. Paradoxically, what aims to lower rents often produces the opposite effect: fewer apartments on the market and higher prices for the few available.
Such regulations, instead of stabilizing the market, distort it, creating an atmosphere of uncertainty that deters private investment and exacerbates the structural problem of insufficient housing supply.
Coupled with this proposal is the Prime Minister’s promise to build 183,000 public housing units for affordable rental. While this sounds promising on paper, the reality is that the state has a track record of failing to manage and execute projects of this scale. Previous plans have been plagued by delays and failures, suggesting that this promise will also remain unfulfilled or only partially realized.
Furthermore, delegating the task to a new Public Housing Company does not guarantee efficiency; instead, it adds expenses to public coffers and creates more bureaucracy for citizens. Establishing additional administrative structures does not solve management issues but rather compounds them.
Another contentious point is the proposal to limit property purchases by foreigners in certain areas. Such restrictions could negatively impact foreign investment, a crucial driver for the real estate sector and the Spanish economy as a whole.
In an attempt to appear as a champion for citizens, Sánchez risks undermining international market confidence. This not only weakens Spain’s image as an open and competitive country but could also lead to reduced job creation and economic activity in key sectors.
Regarding tourist accommodations, stricter regulations, including the imposition of VAT in certain areas, could have a devastating effect on small property owners who rely on this model to supplement their income. Meanwhile, no solutions have been proposed for the real issues of mass tourism, such as the lack of infrastructure and services. This partial and punitive approach ignores the root causes of problems in the tourism sector and unfairly penalizes those attempting to participate legally and transparently.
On the other hand, the “public guarantees” for rental payments for individuals under 35 also raise skepticism. These subsidies risk becoming another black hole for public spending without ensuring concrete results. It is likely that this measure will benefit landlords more than the young people it aims to help. Moreover, the real issue—low wages and job insecurity, which make it difficult for young people to afford rent even with assistance—is left unaddressed.
Sánchez’s management lacks both effectiveness and coherence. While promoting the construction of public housing, his administration has failed to streamline administrative processes to encourage private building. Similarly, his persistent vilification of landlords and tourist accommodations reveals a lack of understanding of market dynamics and citizens’ real needs. The message sent to investors and economic agents is that Spain is not a reliable country for investment, which could have long-term repercussions.
The government has also ignored the growing concern over illegal occupation, an issue affecting thousands of property owners in Spain. Sánchez has not provided clear solutions to protect property rights. This disregard for ensuring legal security and protecting fundamental rights is yet another example of how his administration prioritizes ideological symbolism over effectiveness.
Sánchez’s measures announced seem insufficient and counterproductive.
Instead of solving the underlying issues of the Spanish housing crisis, these policies are set to create new barriers and perpetuate a cycle of frustration and that harms the very people they claim to help.