What impact will Spain's rent cap have?
Spain's left-wing governing coalition consisting of the Socialist Party (PSOE) and its junior partner Unidas Podemos has presented a bill aimed at regulating the housing market. The legislation foresees a rent cap for urban areas and landlords who own more than ten residential properties. Local authorities would be free to decide whether to implement it. Several conservative municipalities, including Madrid, have already announced that they will not apply the law.
Don't scare off investors
La Vanguardia is sceptical about the bill:
“[Rent] price controls through the introduction of certain indices based on the area and the characteristics of accommodation are ineffective measures in most cases. ... They could also have the effect of discouraging potential investors, both domestic and foreign, who could provide the necessary capital to finance the large-scale construction of rental housing that Spain needs to meet current demand, especially among young people. ... [For this kind of construction] European stimulus funds alone are not enough. Sánchez will need to be able to count on national and international private capital as well, and the rent intervention measure won't help him much there.”
Público finds the debate over the bill hypocritical:
“As always when there is news that benefits those who have the least, the elites are branding the measure as interventionism - as if that were bad. ... When the state withdraws funds to subsidise short-time work or to boost public credit lines, it's called aid. ... Hypocrites. ... It's clear that these measures won't be applied in those places where the PP [conservative People's Party] governs. Then they will be punished by the citizens at the ballot box; the impoverished majority will take the reins into their own hands and demand the social justice they lack.”