Main developments of the Housing Act affecting large property holders, developers and funds operating in the real estate sector
The Spanish Housing Act has entered into force, introducing important measures that will affect large property holders, developers and funds operating in the real estate sector.
- New concept of large property holder
- Restrictions on housing rental prices
- Amendments to the system for extending residential lease agreements
- Property tax surcharges imposed on vacant housing
- Increased percentages of land reserves for social housing
- Ban on removing housing definitively subject to a public protection scheme from that classification, with some exceptions
- Restrictions on the sale of the public housing supply
- Amendments to the regulation on eviction processes, mortgage foreclosure and real estate auctions in situations of vulnerability
Entry into force and pending actions
In general, the Housing Act has come into force today. However, some of the measures introduced under it will not be applied immediately. We highlight the following:
- Lease agreements entered into before the Housing Act came into force will continue to be governed by the provisions of the legal system applicable at that time. This excludes measures relating to annual rent increases in 2023 and 2024, which will apply to all agreements.
- By December 31, 2024, the National Institute of Statistics must define the new index replacing the consumer price index for annual rent increases.
- The housing authorities must establish, if applicable, the corresponding “strained housing market areas” and set the reference price indexes for those areas.
- Urban planning legislation must establish the percentages of land reserve for protected housing on rural land and developed land, as well as the percentage of land reserve destined to rented social housing.
- The application of property tax surcharges imposed on vacant housing will require a declaration of vacancy of the property.
- The competent authorities are obliged to establish the conciliation or mediation proceedings, which have been established as a procedural requirement in eviction processes, in mortgage foreclosures and real estate auctions in situations of vulnerability.