The Catalan real estate sector is standing up to the declaration of high-tension zones that the Generalitat has announced as a preliminary step towards capping rents in 140 municipalities in the region.
At the end of June, the Ministry of Territory of the Generalitat of Catalonia began declaring 140 municipalities as high-tension areas. Most of the towns and cities are located in the Metropolitan Area of Barcelona (AMB), have a population of 6.2 million people (about 80% of the total population in the autonomous region) and have, according to the Government, a "particular risk of insufficient supply of affordable housing".
This plan is the one that different associations and entities representing professionals and companies in the real estate sector have resorted to.
According to the official statement, the Council of Associations of Property Administrators of Catalonia, the Council of Official Associations of Real Estate Agents of Catalonia, the Association of Real Estate Agents of Catalonia (AIC), the General Council of Chambers of Urban Property of Catalonia and the Association of Developers and Constructors of Buildings of Catalonia (APCE) have signed an appeal before the Minister of the Department of Territory of the Generalitat de Catalunya, for the resolution of the Secretary of Housing to officially declare the high-tension areas of residential market in the autonomous community, a previous step to be able to establish limits to the prices of the rent in the housings.
The entities consider that the declaration is "contrary to the provisions of Spanish law 12/2023, of 24 May, on the Right to Housing," and already presented allegations on 27 July.
These allegations, the statement reads, "focus on the non-compliance with the procedure established in the Housing Law", such as "the lack of a justification report for each of the 140 municipalities. Why the administration considers that this particular municipality should be declared high tension".
They also alleged the "lack of a specific plan with the necessary measures to correct the imbalance between supply and demand. That is to say, what actions (public, private and/or public-private) should be carried out in each specific municipality to respond to housing needs". And that "the selection of the requirements for formally declaring a high-tension residential area included in the resolution is biased and does not correspond to the definition provided by the Housing Act on such a sensitive issue as calculating the housing burden that families can bear".
The appeal lodged by the entities in administrative proceedings precedes the filing of a contentious administrative appeal.
Implementing the rent cap as soon as possible
On 6 June, the Catalan government announced that it had begun preparatory work to define the areas of Catalonia in which residential rents will be capped, as stipulated in the Housing Law that came into force on 26 May.
This preliminary procedure is "necessary to declare high-tension residential market areas in those territorial areas where there is a risk of insufficient supply of affordable housing," according to the regional government.
According to government spokesperson Patrícia Plaja, the government aims to apply the new law as soon as possible. "Too many months have been wasted on a decision that did not benefit working families, young people or the elderly, and that is why the Catalan government is once again setting the machinery in motion as quickly as possible to bring the rent price cap back into force," she insisted.
What is meant by the high-tension residential market area?
One of the main measures of the Housing Law establishes rent control in those areas declared to be under pressure. But this action depends on the work first of the local councils and then of the Autonomous Regions to draw up a study on the market situation they intend to intervene to submit to the central government.
We recall that this report was to include whether the market could be declared high tension by meeting one of these evident:
a) That the average burden of the cost of the mortgage or rent on the personal or household budget, plus basic expenses and supplies, exceeds 30% of the average income or average household income.
b) That the purchase or rental price of the home has experienced in the five years before being declared a high-tension housing market area with a cumulative growth rate of at least 3% higher than the cumulative growth rate of the consumer price index (CPI) of the corresponding Autonomous Region.
The procedure continued with the sending of the report and its resolution to the General Secretariat for the Urban Agenda and Housing of the Ministry of Transport, Mobility and the Urban Agenda (Mitma), which, every quarter, would approve and publish the list of high-tension residential market zones. The period of validity of the declaration of a territorial area as a high-tension residential market zone would be three years and could be extended annually. Almost no Autonomous Regions are likely to apply this, particularly after the May 28 election results.