- Housing.Rental vs. purchase. This is how prices have behaved (with great differences) by communities since the crisis
The rental price does not stop rising in Spain. In August he did another 5%. And, although it is a core issue of the political debate, the formula to contain the escalation has not yet been found, especially in large cities.
The need to establish a price limit by law was precisely the biggest point of disagreement between the Government and Podemos in the previous legislature. The purple formation came to knock down in Congress the validation of the rent decree that had been approved by the Executive, the only one of all who failed to validate.
Thus, for a few weeks the rental legislation was one -the one passed by decree on December 14, 2018- to later return to the exit box, with the parliamentary defeat of the Government because of Podemos.
All these changes, as well as the messages and the open debate in the institutions about the future of the rental sector in Spain, have made many owners have chosen not to take their homes to the market and, even, to withdraw them.
The commercial director of Rental Insurance, David Carballo, said yesterday that, although demand continues to grow, the supply of the rental market is declining in Spain "as a result of bad legislative decisions at the beginning of the year and uncertainty and instability policy of the last months ». Therefore, he says, prices are rising so much.
An example: applying the Rental Contract Income Updating Index (Arca), a rental of 700 euros signed in August 2018 would be updated this month at 733.74 euros. A rise of 4.82%.
“The problem is that the political situation that we live in Spain not only does not encourage more housing to be brought to market , but that it is getting the offer to decrease and, therefore, the prices of rental homes to increase,” remarks Carballo in statements collected by Europa Press.
In the absence of an official indicator on the evolution of the rental price - the INE does not have a record and the official reports often start from the activity of the real estate portals - another fact clearly reflects the stagnation of the sector, in terms of available supply , that not to your demand.
The percentage of rental investors - who purchase homes to rent them later - has been falling for two years. In the first six months of 2019 it has fallen to 26.9%.
Barcelona, where the presence of investors has always been high, is currently the city with the lowest volume of this type of buyer (23.8%), according to data released yesterday by Tecnocasa. Investors now prefer Madrid (30.24%), Valencia (35.64%) or the periphery of Barcelona , with L'Hospitalet de Llobregat (36.84%) leading the way.
The price of rentals has behaved since the outbreak of the housing bubble diametrically opposite that of housing. A recent report by the BBVA Foundation and the Ivie, reflected that the purchase price has fallen by 10% since the beginning of the crisis and that of the rental has become more expensive, by 11%.
In our country, the majority option is still the purchase [77.1% of households] and is still well above the Eurozone average [66.1%], but the rent has been gaining ground steadily. In 2007, 14% of households were rented. Today they are already 18%.
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