Government Pushes for Urgent Housing Decree Approval

Prime Minister Pedro Sánchez is urging political parties to back a draft housing decree set to be discussed at Tuesday’s Council of Ministers meeting, aiming to secure enough support for its subsequent validation in Congress.

The proposed decree includes a ban on evictions of vulnerable people until 31 December 2028, an extension of rental contracts up to two years, tighter controls on short-term tourist rentals, and tax incentives for landlords and tenants. The measures come amid growing public pressure following the high-profile eviction of Maricarmen Abascal, an elderly woman from Madrid whose case has become a national symbol of the housing crisis.

Key Measures in the Draft Decree

  • Prohibition of evictions affecting vulnerable individuals without alternative housing until 31 December 2028.
  • Extension of urban rental contracts for up to two years, with annual rent increases capped at 2% until the end of 2027.
  • A 25% tax on SOCIMIs’ undistributed profits from residential rentals unless reinvested in affordable housing.
  • IBI surcharges of up to 150% on long-term vacant homes and up to 100% on properties used for tourist rentals.
  • A 10% tax deduction for tenants in stressed areas with annual taxable income below €33,007.20.
  • State-backed 0% interest loans of up to €50,000 or 20% of a property’s value to assist first-time homebuyers.
  • A sanctioning regime imposing fines of up to €1 million or 2% of turnover on digital platforms failing to report data to the Single Digital Window for tourist housing.

The draft also prohibits landlords or agencies from charging tenants for contract formalisation or management fees, and bans the requirement to take out non-payment insurance. It further restricts speculative purchases of housing by vulture funds until the end of 2028, though implementation details remain unspecified.

"People want solutions" in the face of the housing crisis, said Minister of Culture Ernest Urtasun, reaffirming the government’s willingness to consider tax incentives for small landlords affected by eviction suspensions.

Political Objections Delay Consensus

Despite efforts to build cross-party agreement, both Junts and Sumar have expressed reservations. Junts claims the latest draft deviates substantially from prior understandings and fails to include concrete mechanisms to pursue vulture funds or regulate room rentals. They insist on tax breaks for small landlords and stronger enforcement against speculative investment.

Sumar, while welcoming price freezes and rental extensions, says the decree still lacks essential elements, including automatic contract renewals and regulation of room lettings. Minister of Health Mónica García stated the party remains "very far" from agreement, demanding stronger eviction protections and comprehensive rental market reforms.

ERC has also rejected the proposal, arguing it does not go far enough in regulating tourist rentals or increasing VAT on short-term lets to 21%. Currently, the draft raises VAT on tourist accommodation to 10% from 1 October 2026.

Next Steps and Public Pressure

The government has removed references to land law reform to appease Podemos, and includes provisions for public compensation to landlords impacted by eviction suspensions, covering unpaid rent, utility arrears, and property damage.

Parliament President Josep Rull warned that ideological entrenchment could block a deal, despite existing areas of common ground. Sánchez continues to appeal for responsibility and state-minded cooperation ahead of Tuesday’s Council meeting.

Protests continue across Madrid and Barcelona, with Sumar leaders visiting Maricarmen Abascal in hospital to underline the urgency of legislative action. The final text must balance social protection with fiscal incentives to gain the parliamentary majority needed for approval.

Reported by 3cat.cat, democrata.es, L.J.F, rtve.es, 3CatInfo Barcelona.