Housing shortage dominates Spain’s snap election campaign
Housing shortages are dominating Spain’s snap election campaign, a topic that led voter concerns for three straight years but only recently surged to the top of the political debate, according to Reuters. The issue gained momentum after authorities forcibly evicted 87-year-old Maricarmen Abascal from her Madrid apartment last month. Her case, following the purchase of her building by a real estate firm, sparked nationwide protests and forced the housing crisis into the spotlight, eclipsing immigration headlines that had followed recent migrant arrivals in Ceuta.
A Complex European-Style Shortage
The housing crisis in Spain shares characteristics with other European nations, including complex bureaucracy and labor shortages that block new supply. The market also faces the spread of short-term rentals and high demand in city centers, which drives up prices and empties rural areas. This dynamic has energized young voters across the region, from Ireland’s 2024 elections to recent Berlin mayoral races, as people grow weary of housing costs eating up a growing share of their income.
Regional structures often create obstacles for housing policy. While central governments can create legislation and national plans, implementation and broader urban development largely fall to regional authorities and municipalities. Various measures, from rent controls proposed by the socialists to zoning loosening proposed by conservatives, have been rejected, blocked, or simply not applied since the Socialists took power in 2018.
From Surplus to Deficit
Twenty years after a housing bubble burst and damaged the economy, Spain has shifted from an oversupply to a major housing deficit. According to the central bank, the deficit currently stands at 750,000 homes and is projected to reach one million by 2028. This gap emerged because the market did not produce enough new units in high-demand areas where prices and rents were rising, despite a stable economic recovery and ultralow interest rates.
Although 73% of Spaniards own their homes, over half of people aged 18 to 34 live with their parents or rely on them for housing costs. Official statistics showed last year that housing prices rose three times faster than wage increases, forcing more people into renting. The fund for social housing, which amounts to just 1.7% of the total housing stock according to the European Commission, is among the lowest in the EU.
Party Proposals and Resistance
Socialists proposed housing plans in parliament last Friday, but the measures were rejected by right-wing deputies. These measures included rent caps and restrictions on corporate property purchases. The deputies argued such measures would deepen the problem by stifling supply. Alberto Núñez Feijóo, leader of the center-right opposition People’s Party, promised instead to build 250,000 new homes annually in projects that would create 600,000 jobs. Feijóo also wants to speed up urban planning procedures and provide stronger guarantees for mortgages and rents for young people.
Trade unions have called for curbing “predatory funds,” corporate investors they say drive up prices and use forced evictions. The union successfully intervened in several cases where properties were bought by institutional investors, securing compensation agreements or preventing evictions like Abascal’s. However, Jorge Galindo, director of the EsadeEcPol economic policy center, warns that aggressive government action against private investors will cool construction projects. “Government decrees create a conflict between protecting people who already rent and facilitating supply for those who still haven’t found a place to live,” Galindo noted.
Property registry data shows institutional ownership outside densely populated cities like Madrid is minimal. Only 4.4% of homes in the country are owned by companies, and 4.3% of these owners hold 11 or more properties on the market, subjecting them to stricter regulations. About 40% of rental properties belong to individual owners with just one unit on the market, who supplement their salaries with rental income, according to central bank data.
