• All
  • House/Chalet
    • Luxury Villa
    • Single family house
  • Garage
    • Parking
  • Premises or Warehouse
    • Business Premise
    • Business
  • Office
    • Office
  • Apartment
    • Loft
    • Flat
    • Duplex Penthouse
    • Apartment
    • Penthouse

Encontramos la casa de tus sueños

Press to search...
News
Summary New Spain housing law 2023
 23

  MAY

Summary New Spain housing law 2023

Summary New Spain housing law 2023

1 – Expansion of stressed areas in the rental market

"The conditions for the declaration of a stressed area are improved and facilitated, covering more areas for the application of control measures." The declaration of a neighborhood or a municipality as a "stressed area" will depend on each Autonomous Community, including the City Council of the municipality where these areas are being studied in the review.
For an area to be declared stressed, it must meet one of these two requirements: that its price has increased by more than 3 percentage points in the CPI value in the last 5 years or that the average home price exceeds 30% of the average income. from the area.
The determination of stressed areas may be from census districts such as micro zones and even areas as wide as entire Autonomous Communities.
To declare a stressed area for rent, at least one of these two conditions must be met:
- That the average cost of the mortgage or rent plus basic expenses and supplies exceeds 30% of the average household income
Example: if the average income in an area is 3,000 euros per household, the sum of the price of the home (mortgage or rent) plus utility costs cannot exceed 1,000 euros
- That the purchase or rental price of the home has increased at least 3 points above the CPI in the five years prior to the declaration of a stressed area.
Example: if a house cost 300,000 euros in January 2020, the CPI value would have increased in January 2023 between January 2020 and 2023 (12.9%) plus an additional 3 percentage points (15.9%). Thus, the house would have to be worth 347,700 euros.

2 – New definition for large holders

A distinction will be made between large and small owners.
- Large holders: will be those individuals or legal entities that own 5 or more homes in stressed areas or up to 10 homes (or 1,500 m2) in non-stressed areas.
- Small owners: they will be those individuals or legal entities that own less than 5 homes.

3 – Limit of the annual update of the rent eliminating the CPI

This is, without a doubt, one of the most controversial measures of the New Housing Law 2023, since there are many experts who have spoken out against this type of measure.
With the new regulations on rental prices, as of January 2024 (remember that currently the rental update is limited to a maximum of 2% as an extraordinary measure), rental updates will be limited to a maximum of 3% and will be decoupled from the CPI.
Rent updates will always be limited by an index: 2% in 2023, 3% in 2024 and a new rental price update index will be approved in 2025
In addition, it is expected that by January 2025 a new reference index will be created by which all rents will be updated and that it will be more stable and lower than the CPI. For now, the working group assigned for the law is working to define what this will be like. index by which the rentals will be governed.

4 –Regulation of rental prices in stressed areas

The rental prices of the new contracts, regardless of whether they are from large or small owners, will be regulated and capped. This measure is intended to contain and reduce the price of rental housing and will not be applied in areas NOT declared stressed.
This law also contemplates the inclusion of new rental homes on the market within these stressed areas, which will also be limited in price according to the powers of each Autonomous Community.
These limits will be established, depending on the type of contract and who is the owner (small or large holder).
- For small owners: by indexing to the previous rental price in force, that is, according to the rental price of the contract prior to the new rental contract.
Example: If a home had a rental contract for 1,000 euros per month, in the new contract the rental price may not exceed these 1,000 euros plus the increase corresponding to the current rate (2% in 2023, 3% in 2024 and to be defined). according to the new index from 2025) – Thus, if a new contract is made in 2023, its price may not exceed 1,030 euros per month.
- For large holders: by applying the price containment index, which is yet to be defined.

5 – Transfer to the landlord to pay the real estate fees

The new regulations contemplate in Section 1 of Article 20 that "The expenses of real estate management and those of formalization of the contract will be borne by the landlord".
The tenant will continue to pay the deposit and the additional guarantee when signing a new rental agreement.

6 – Prohibition of increasing the rental price with extra expenses

It is prohibited to increase the rental price by adding new expenses (community, garbage fee, etc.)

7 – Prohibition of “agreement between the parties” contrary to the Housing Law

The clauses that allowed the non-application of the measures contained in the Law if there was an agreement between the parties are eliminated. The Urban Leasing Law allows, as in any contract, the parties to reach agreements even if they are contrary to part of the Law.

However, as the draft indicates, "from a preponderant position of the owner over the tenant that usually occurs, the tenant could be forced to waive by contract the measures and rights contained in the Law to obtain the contract."

8 – New protection measures against evictions

This new regulation has several measures to achieve protection:
- Put an end to evictions without a predetermined date. Thus, it should be mandatory to establish a date and time to carry them out.
- New extensions are included in the launch procedures, which will postpone the processes for more than 2 years.
- Mandatory access to out-of-court settlement procedures for vulnerable people.
- The CCAAs will be able to articulate their own mediation and housing alternative mechanisms that they deem appropriate.
- The ability to use funds from state housing plans to offer housing alternatives for people at risk of eviction through subsidized social rents, rehousing people in vulnerable situations or any other policy is recognized.

9 – Tax benefits for owners

Small owners who have a home in an area declared stressed will receive tax incentives in the IRPF to put their home for rent and compensate for the fact that the price increase of the new rental contracts is limited in relation to the previous rental contract. .
For now, the details of the tax rebates have NOT been disclosed, although those of the old draft of the 2022 housing law proposed a rebate of up to 90% of the income obtained by the owners in the event that the rental price falls.
Bonuses:
- 50% bonus to all those owners who rent their home.
- 70% discount: If it is rented for the first time to young people between 18 and 35 years old or If it is a new contract with improvements or rehabilitation
- 90% bonus if it occurs in stressed areas

A tenant (small holder) with a home in a stressed area that sets a rental price of €800/month and applies a 5% reduction on the rent up to €760/month could obtain a reduction of up to 90% of the benefit Net income tax. In this case, it is calculated that the net income would be €6,384, which if they are currently taxed at 60% (€3,830 would be taxed), with the new housing law this reduction would go up to 90%, so the amount subject to tax would be of €638.

10 – IBI surcharge for empty homes

More taxes for empty houses. To encourage the rental of these homes to those that have been empty for more than two years for owners with more than four homes in the same municipality, the Government will allow municipalities to increase the IBI rate for homes that are empty with a surcharge of up to 150%.

11 – Impossibility of changing the public housing qualification

Subsidized housing that is promoted on land whose destination is that of housing subject to some public protection regime will be subject to a permanent public protection regime that excludes disqualification, as long as the qualification of said land is maintained. In addition, the indefinite qualification of subsidized housing is established.

12 – Increase in the rental supply with the incentive affordable housing

In order to increase the supply of housing at prices appropriate to the economic situation of households in each territorial environment, the public powers, within the scope of their respective powers, may promote the existence of affordable housing with incentives, which will be subject, on a guidance and without prejudice to what is established in this regard by the competent administrations. - (c) 2023 Adevinta, in case you redistribute or disseminate our protected content, remember that you must quote us.

More information on the Ministry's website: https://www.lamoncloa.gob.es/serviciosdeprensa/notasprensa/transportes/Paginas/2023/170523-ley-derecho-vivienda-aprobacion-definitiva.aspx

Source: Fotocasa

Subscribe

Subscribe to our mailing list and you will be first to receive new properties

Diseñado por CRM Inmovilla
Send this form with your name and phone number and we will contact you as soon as possible.
When you press the button “SEND” you confirm you’ve read, understood and accepted the conditions of our Privacy Policy shown in this LINK