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Limits on rent increases divide the Government

2020-10-23T02:36:58.094Z


United We can press to approve a rent limitation as soon as possible but the PSOE prefers to wait for the future Housing Law


The second vice president of the Government, Pablo Iglesias, during a meeting with representatives of the tenant unions, last week in Madrid.JJ Guillén / EFE

The rent again sows discrepancies within the Government.

In the last legislature, the issue raised blisters between PSOE and Podemos and that is why in the coalition pact peace was sealed with a commitment: to put some type of limit on income.

Having saved that stumbling block, the discussion that has emerged now is the how and when.

The formation of Pablo Iglesias believes that it is the moment to do it, taking advantage of to shield a law that Catalonia has approved in that sense;

the government's socialist quota prefers to wait for the pandemic to pass and define it in the future state housing law.

This is how things are:

A budgetary discrepancy?

The last division of opinions at the expense of rent has been made public these days, at the same time that the draft of the Budgets was closed.

Various government sources insisted that the only thing pending to close the agreement were some “fringes”.

The purple formation itself admitted last Friday, when the second vice president met with representatives of the tenant unions to give force to their claim, that the pact on rents could be addressed in parallel to the negotiation of public accounts.

However, the meetings to discuss the issue are constant and have intensified in recent days.

A law in danger

The Parliament of Catalonia approved on September 9 a law that limits rents in 60 cities of that community, including the four provincial capitals.

The rental prices are conditioned to what the last contract of a property that has been rented in the last five years marks or to the price index established by the Catalan housing agency.

However, the regulation was threatened because the Council of Statutory Guarantees of the Generalitat already warned that it was invading state powers (rents are regulated in the Urban Leasing Law).

Although the Government has not shown interest in resorting to the Catalan rule, Unidas Podemos has argued the political convenience of shielding it with a legal change that allows communities to put limits on leases.

With that gesture, they believe that the way would be paved for the approval of the Budgets with the majority of the investiture, which includes the Catalan nationalists.

Although it is by omission, Pablo Iglesias' party also makes it clear that it prioritizes that option over the other one on the table: an agreement with Citizens to carry out the accounts.

The other arguments of Podemos

In addition to the political argument of paving the parliamentary negotiation of the Budgets, the purple formation appeals to the "social emergency" that Spain is experiencing.

They believe that this is a reason to enforce one of the points of the agreement of the coalition government, which promised to stop abusive rent increases.

To do this, it proposed using the official reference price index and empowering autonomous communities and municipalities to use it.

In addition, it contemplated taking “into account the progress of those communities” that had their own price reference system, as is the case in Catalonia and the Valencian Community.

Since Catalonia has taken the step forward of regulating, United We can believe that it is time to support this path.

The party of the second vice president has not specified the specific legal instrument that would be used, but its leaders point out that the Catalan model is interesting and they bet that it can be extrapolated to other territories.

The competences in housing are transferred and there is no doubt that the communities should be the ones that limit the rents, but the Government had to provide the legal framework for this and it is clear that one of the current obstacles is the Urban Leasing Law.

It states in one of its articles that the rental price is the one freely agreed by the owner and the lessor.

The modification of that article has already focused discussions in the past between Podemos and the PSOE.

What the PSOE says

The government's socialist quota maintains that rent limitation is a legislative commitment and must be addressed, but argues that this is not the time to do so.

To do this, they recall that the Minister of Transport, Mobility and Urban Agenda, José Luis Ábalos, promised last February to bring the issue to parliament before the summer.

But then the pandemic arrived and it changed everything: first it delayed the launch of the official price index, which was scheduled in March and was finally published in June.

And secondly, they express doubts about the photo that shows that statistic because they believe that it does not respond to current reality.

The PSOE considers that the coronavirus crisis has profoundly disrupted the economy and with it rents.

In response, emergency measures such as rent reductions and deferrals, the moratorium on evictions and the automatic extension of lease contracts have been promoted.

None of this can be seen in the official price index, which is based on income tax returns and therefore shows old data.

The slogan is to wait and see how the market looks before approving a regulation that defines which areas can be declared stressed and are likely to put limits on rents.

In addition, the public consultation process of the Draft Law for the Right to Housing has just been opened, so they want to address the issue in that regulation, which will foreseeably reach Congress next year.

Tenants in favor, companies against

Regardless of the positions of the two government parties, the question raises social debate.

The tenant unions have always been in favor of the regulation of leases, they have been the main promoters of Catalan law and, broadly speaking, they maintain the same position as Podemos to act as soon as possible.

Many social organizations, 9,000 according to the promoters, have signed a manifesto this week calling for the regulation of rents.

In the real estate sector, on the contrary, the most generalized position is the rejection of limiting rents by law.

One of the most repeated arguments is that you can contract the offer because, in the face of legal uncertainty, homeowners prefer not to rent it.

Both of them appeal to international examples, where in recent times experiences of price control have proliferated, reinforcing their points of view.

In Spain, Catalan law is too recent to draw conclusions.

An ancient conflict

The friction over rents is nothing new, rather they have been a constant since the successful motion of censure of June 2018. In the budget agreement of October 2018, signed then by the one-color Government of Pedro Sánchez and by United We Can, a commitment to limit rents was already in place.

However, the high point of the confrontation was reached soon after.

At the end of January 2019, Podemos frustrated the parliamentary validation of a decree on housing approved by the Government, which later forced another text to be renegotiated

in extremis

before the imminent election call of April 2019. Since then many rough edges have been smoothed out and Nobody is counting on the discrepancies going that far this time.

Source: elparis

All business articles on 2020-10-23

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