The Ministry of Transport, Mobility and Urban Agenda has submitted a new rent control proposal to the Ministry of Social Rights to try to seal a draft of the future housing law. The department headed by José Luis Ábalos is committed to limiting the increase in rents in stressed areas (the name for places where it is considered that the leases have escalated beyond what is reasonable) to 10% of the price they had in the contract previous. The measure would apply exclusively to new contracts signed in those areas. Transport, which carries the weight of the negotiation by the socialist part of the Executive, considers that it adjusts to what was agreed in the agreement of the coalition government. Social Rights, which leads the negotiations on the part of United We Can and insists on its objective is not to freeze rents but to lower them, has not yet responded to the proposal. But Minister Ione Belarra has denied on Twitter that there is an agreement, as has been published by some media.
The socialist proposal combines the limit on rent increases with a forced extension for existing rents, as sources from Transport had already announced. As long as the area is considered stressed (the declaration would depend on a procedure in which the State and the autonomous communities would participate and would be done for three years), the tenant whose contract expired could decide to extend it up to three years, in annual extensions, maintaining the same conditions. In addition, the package of measures proposed by the PSOE maintains tax incentives, the first proposal made by the majority party in the Government to regulate leases. These include tax credits of 90% for landlords who, in one of these areas, agree to sign a new contract reducing the price of the previous one by at least 10%.
With the combination of the three measures, sources from Transport indicate that their proposal “scrupulously complies with the signed agreements” and responds to the objective of “ending abusive increases, containing rents and lowering rents. Therefore, they are waiting to receive a response from the Ministry of Social Rights, with which they have been discussing for months how to regulate rents in what will be the first state housing law of democracy. “The only way to lower prices is with benchmarks, not tax incentives,” Belarra replied on Twitter.
Although the positions have come very close in recent months, two weeks ago United Podemos sources already pointed out that the proposal to freeze rents through the forced extension of rents “would not allow lower rental prices, as stated in the budgetary agreement between both formations, nor would it cover the Catalan housing law ”. Saving this norm – promoted by En Comú Podem together with the nationalist forces and appealed by the PP and the Government in the Constitutional Court – is one of the objectives of United We Can. In fact, it is the formula applied in Catalonia, where a price scale is established that functions as a ceiling depending on the location of the lease, which Belarra has defended in his tweet when referring to the “benchmark indices”.
The new discrepancies surface on a significant day for the future housing law. Stuck since the beginning of the year, this Wednesday expires the theoretical deadline that the Government had given itself to approve a draft of the law and send it to Congress. This is reflected in the recovery plan sent to Brussels, which also includes a long parliamentary procedure. According to that document, the final approval of the standard would not arrive until the second half of 2022.