At a key moment for the future of the real estate sector, our CEO Manuel Pertusa reflects in the newspapers Diario ABC and Información on the latest proposals on housing and their real impact on access to housing. With a critical and constructive vision, he addresses the need for effective policies that promote supply and respond to the real demands of the market, instead of measures that only generate headlines without solving the underlying problem.
You can read the article in the following links or further down in this post:
The olive paradox in measures against the housing sector
Manuel Pertusa, MPC Group CEO
There are two realities that must be addressed in order to analyse the current times in the real estate sector with rigour. On the one hand, the undeniable reality that a large group of the population has real problems accessing affordable properties, despite having a job, a regular income and a solvent situation of stability. And a more dramatic reality for young people, the long-term unemployed or immigrants without a social or family cushion who find it impossible to access them. The other reality has to do with the measures proposed by politicians and the administration. In times of fleeting impact, social networks, and simplification of messages, housing policies are characterised more by being effective than efficient. And, above all, they go more to the heart of public opinion than to the pockets of the public who have real problems in achieving affordable housing.
This is the line taken by the latest proposal launched by the government to limit the purchase of housing by non-resident non-EU nationals. This is a new trial balloon that has not yet materialised, as it is not yet known whether it will be through a new tax figure or by increasing the current ones up to increases in their values of 100%.
We have no doubt that, if this measure materialises, its effect will be innocuous in favour of those who need housing to live in, and erroneous and very negative for the Spain brand and a very specific business fabric in provinces such as ours. Limiting access to housing for non-EU non-residents will have a minimal impact on the country as a whole. Although national studies quantify the incidence of these purchases at 2%-3% of the total, each province has a different reality, and in Alicante this figure reaches, for new housing, 27% of purchases and 30% of turnover, percentages which, if lost, would have a devastating impact on the sector. Nobody is going to have a better chance of accessing a home by making it more difficult for buyers from the United States, Canada, Russia or Morocco, as well as the British, Swedes, Finns or Ukrainians, who are looking for a specific high-end or very high-end product. The government is proving to be wrong in its diagnosis, and therefore wrong in its prescription.
Because measures of this magnitude will only encourage many non-EU residents, professionals who come to telework or who intend to retire and consume in our country to move to other destinations: Portugal, Greece, Turkey, Italy or even new destinations such as Morocco. This is undoubtedly a new burden for the development of a fundamental industry in our province, such as the construction sector, which is a major tourist attraction. Tourism will also be a victim of this type of measures proposed by the government.
The public authorities must understand that the problem is the lack of supply, not the peculiarities of demand. And it is not solved by attacking the interest of foreign buyers in our country and in our province. The Bank of Spain quantifies the shortage of mid-range housing, that which a typical family in this country is looking for and can afford, at around 600,000 homes. This is where the Government should place the emphasis: on generating the necessary conditions to enable part of the sector to focus its activity on this segment of the market. This is where we must work, by making the construction process less bureaucratic, by offering tax relief to buyers of mid-range housing and by offering specific developments for specific population groups with special difficulties. It is the lack of housing, the lack of management of the holiday rental model, the non-existent public housing policy of the last 15 years, the lack of land for affordable housing, the crisis of materials and their prices, it is all this together that produces the perverse cocktail in the big cities, in the metropolitan areas of the provincial capitals and in tourist areas that hinders the possibilities of access to housing for the middle classes. Taxing non-residents does not dilute this cocktail, it simply eliminates its olive. This is the paradox.
