The rent limitation continues to arouse reactions against it, despite the fact that the mechanism to be applied by the Government is still unknown and there are months for it to come into effect. This time it was the economists who, unanimously, have shown their rejection of this measure because they believe that it is a short-term proposal that does not solve the problem of access to housing in Spain.
“The control of income is linked to magical thinking that some have when they think of economics “, said the economist Josà GarcÃa-Montalvo, at a conference organized by the General Council of Economists this Monday. In his opinion, rent capping has achieved something that few initiatives achieve: that all economists agree on its ineffectiveness. “In medicine, it would be like cutting off the patient’s head when he has a headache,” he assured.
On the contrary, both GarcÃa-Montalvo and Joan RÃfol, President of the Urban Property Chamber of Barcelona who also spoke at the event, they believe that the problem of access to housing in Spain requires a “calm” debate on housing policy in which the prime socioeconomic analysis and not easy approximations. “Housing policies are expensive and have to be maintained over time. The easy thing is to pass the burden on to the private sector,” RÃ fols said.
Among other things because within that private sector there are more than 2.3 million individuals that each year they declare rental income in their accounts with the Treasury.
Effects on the market
According to the president of the Barcelona Chamber of Urban Property, putting limits on rents has already been tried at other times in history here in Spain and is also in force in several European cities, but in any case , has not given the expected results. “Rent control has done more harm than good in all the markets in which it has been implemented,” he assured.
Among other things, as both experts have pointed out, it causes a supply reduction, legal uncertainty, avoids the renewal of the rental park and generates an unequal distribution of benefits.
For all these reasons, “a consistent and continuous policy of reinforcing social rent and public-private collaboration would be necessary” to promote affordable rent.
And this policy would include the construction of a large social housing stock or increasing the social spending that Spain allocates each year to housing. “In Germany it was 223 euros per inhabitant in 2017, compared to 26 euros in our country”RÃ fols has said.
Along these lines, both have rejected the measure imposed two months ago by the Government of Catalonia to cap the price of rents in the most stressed cities. In Barcelona, ​​one of the points with the highest prices in the country, prices have been falling since the second half of 2019, so RÃ fols has not dared to draw conclusions regarding the impact of the measure. “There is still no data on what part of the current declines are due to a bearish market situation and what part corresponds to the new measures of the Generalitat”, he assured.
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