Monday, July 4

The upcoming new Housing Law and its impact

From Grupo Lar, his opinion in this regard, “First, we understand that the Public Administrations have a great challenge ahead in terms of housing, especially in social housing because there is a clear deficit, accumulated by the different Administrations for many years. According to a recent report by the Ministry of Transport, Mobility and Urban Agenda, the need for social housing is estimated at 1.7 million units so that the share of this type of housing in the market is similar to the European average. And this, clearly, has to be solved ”. And continues Miguel Ángel Peña, CEO Residencial Grupo Lar España. “From Grupo Lar we agree on the diagnosis, clearly there is a problem of access to housing in many parts of Spain, but we do not agree on the treatment, we believe that there are other types of measures that better combine the right to housing worthy of citizens with the legal protection of current and potential investors and private property, since the promotion and construction of homes has been and will be a sector that generates employment and wealth in Spain, unless we insist otherwise. Measures such as those announced will only serve to scare away potential investors and may open the doors to a legal battle with an uncertain outcome., but they will not serve to solve the problem, as has already been shown by similar experiences in Berlin or Barcelona, ​​which have failed miserably. Experience shows that only the treatments that are applied from the supply side are effective, and not so much those that are applied from the demand side as it is a limitation on rents. It would have been good for the entire sector, administrations, developers, investors, builders, etc. We would have sat together to find ways to solve this challenge, but it has not been the case. An example of a working formula, and there are many others, would be the Plan Vive of the Community of Madrid or the Plan Metropoli in Barcelona, ​​in which public land is made available to private initiatives under a concession regime to develop and operate housing of affordable rent for groups that need it. Public Administrations have, in many cases, publicly owned land to be able to solve the problem. Unfortunately, this situation will not be resolved with short-term measures by private initiative. This will lead investors to seek other types of investments and / or other countries ”, he adds.

Also Inmobiliaria del Sur, INSUR, has given us its point of view, always warning that, for the moment, the information they have on the agreement reached between the Government partners, PSOE and United We Can, on the future housing law is very concise. INSUR indicate that, from their point of view, “an issue so relevant to society should not be legislated without deep reflection and sufficient political consensus. It seems that these circumstances are not sufficient at the moment ”. INSUR adds, “We understand that it may be appropriate to act legislatively to favor access to housing, either for rent or for property. On this issue and the recognition of the right to it, we do not enter as a company, as this transcends political positions. ” This real estate Group has an exposure to housing focused solely on the promotion of new housing for sale to individuals, since it does not have, nor does it manage property for rent. INSUR carries out its activity in the Communities of Andalusia and Madrid, and as they comment “it seems that, once this agreement of the government partners is materialized in a legislative initiative that is finally approved, these Communities, as long as they maintain the current political orientation, discard its future application”. In addition, INSUR clarifies that “However, in the short term, this initiative may trigger a rebound and inflationary effect in the price of housing, because on the one hand, there will be private owners who discard offering their home for rent, thus reducing the supply of these in the market, and on the other, an increase in demand since many interested parties may accelerate their purchase decision due to the uncertainty that mixed promotions can generate, with a part of free housing and 30% of protected housing and half of this last typology destined to social rent for underprivileged groups ”. INSUR also hopes that “as a precautionary measure, the promoter companies will accelerate the process of licensing their plots, thereby trying to avoid the application of the measures on their promotions, especially in those territories politically aligned with the government coalition. Something similar already happened in Barcelona a few semesters ago. Additionally, it is probable that investment decisions in process on plots dedicated to residential development, both for rent (BTR) and for sale to individuals, will come to a standstill while the current uncertainty in the market clears. In the medium term, and if the initiative is legislatively approved and adopted by the majority of the autonomous communities and city councils, there will be a slowdown or paralysis of the promotion activity, as long as the business plans on the plots are not adapted to these new conditions and restrictions imposed. The promotion sector will be affected, delaying the execution of business plans and, therefore, affecting their expected profitability. The construction sector, which has been focused almost exclusively on promotional activity for several years due to the shortage of public works, will be affected and there will be a noticeable increase in unemployment. INSIR opines, “From our point of view, in recent years politically all the focus has been placed on access to rental housing, forgetting the necessary drive towards home ownership. Home ownership offers a series of advantages that must be taken into account, and specifically, as an instrument of savings during the working life of the spouses, support of the family economy when they reach retirement. For many families it would be impossible, upon retirement and with the current level of pensions, to face the rent of their home. We believe that a reconsideration of the role of the state and the autonomies towards protected housing property should be carried out, re-articulating means and aid to it, especially for young people. We are facing two generations of young people who are seeing their professional lives and, therefore, their vital projects cut short as a result of the successive crises that have occurred. And access to housing is one of them. Today there are many young people who can afford to pay the mortgage payment, but lack the necessary savings to face the part of the price of the house not financed with the mortgage and the amount of expenses associated with the purchase. The measures would have to be arbitrated, either from the administration, via public guarantees, or from financial institutions in collaboration with insurance companies to face this problem and facilitate young people’s access to home ownership “.

Reference-www.estrategiasdeinversion.com

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