Estate agents are already cancelling viewings as Spain's housing decree takes effect

Spain's first housing decree is now in force, and estate agents are already reporting cancelled viewings and rental listings being withdrawn. The FADEI association and firms such as Alfa Inmobiliaria and Tecnocasa warn of a supply contraction that could reach 25% within a year.

Regulatory uncertainty has swept into the Spanish rental market in a big way. The first housing decree has been in force since its publication: it halts evictions of vulnerable people until **31 December 2030**, allows an extraordinary extension of standard rental contracts of up to two years, caps annual rent increases at **2%**, and bans investment funds from buying homes below **70%** of their value until 2030. The second decree, which includes automatic contract renewal unless the owner has justified need and financial penalties for landlords who fail to renew, failed to win the backing of the PNV (Basque Nationalist Party) and remains pending.

The Spanish Federation of Real Estate Associations (FADEI), chaired by **Miguel Ángel Gómez Huecas**, has expressed its "concern" over what it sees as a way of legislating that deepens distrust. In the industry, no one is talking theory. They are talking about phone calls, cancellations and listings that vanish.

## The first decree is already in force: what changes for landlords and tenants

The text now in force introduces four concrete measures. The first is the halt on evictions of vulnerable people until the end of 2030, a measure that previously existed on a temporary basis and is now extended for almost a decade. The second is the extraordinary extension of standard rental contracts by up to two years, which prevents the owner from recovering the property at the end of the term if the tenant wants to stay. The third caps annual rent increases at **2%**, far below the inflation rate of recent years. The fourth bans investment funds from buying homes for less than **70%** of their value until 2030.

This first decree was passed with the favourable vote of the **PNV** in the Permanent Fruta, a body that operates between legislative sessions. The Government used that route to approve measures that the Lower House had rejected just days earlier. The second decree, however, has not won the same support. It includes automatic contract renewal —unless the owner has justified need— and financial penalties for landlords who fail to renew. Without the backing of the Basque party, its future is uncertain.

For landlords, the message is one of legal risk. For tenants, confusion. And for the market, paralysis.

## Estate agents are already feeling the withdrawal of listings and cancelled viewings

**Jesús Duque**, vice-president of Alfa Inmobiliaria, describes the situation bluntly: the new decrees introduce "unprecedented regulatory intervention" whose effects had been visible for some time but are now intensifying. The combination of extraordinary extensions, near-automatic renewals and price caps removes the predictability any owner needs to plan their assets. Small landlords, who account for more than **90%** of Spain's rental stock, perceive a disproportionate legal and financial risk and are choosing to pull their properties off the market.

Alfa Inmobiliaria estimates a contraction of between **15% and 25%** in rental supply over a six-to-twelve-month horizon. The decline will not be uniform: it will hit mid-priced residential rentals hardest, where small landlords mainly operate, while luxury rentals and housing for specific groups may remain more stable.

Duque confirms they have received "a huge number of calls" from landlords worried about the legal security of their contracts. They have not made definitive decisions, but many have said they intend to wait before renewing or listing new properties. There are already "specific requests for immediate withdrawal" and cancelled viewings, especially in the rental segment. Some landlords are exploring alternatives such as short-term rentals or selling. "What is worrying is not so much the absolute volume of withdrawals as the trend," Duque sums up.

## Rental supply could fall by up to 25% within a year

**Lázaro Cubero**, head of analysis at Grupo Tecnocasa, links the decrees to the entry into force of the Housing Law. Just weeks after it was passed, Tecnocasa published a study estimating an **11%** drop in supply nationwide, meaning the disappearance of more than **100,000 homes** from the traditional rental market. Three years on, the scenario is repeating itself with even more uncertainty. "The new decrees add legal uncertainty to what already existed," Cubero notes.

The Spanish Observatory of Real Estate and Insurance Solutions (OESA) has an even harsher forecast. According to its estimates, the application of these decrees will remove one in three rental properties between now and the end of the year. Its president, **Javier Íscar**, pulls no punches: "It is unthinkable that anyone would want to rent out a flat in the next two months under a provisional situation. It represents a practically total shutdown of the rental market due to a political decision."

The situation also affects tenants, though less visibly. Alfa Inmobiliaria detects a dual pattern: some prospective tenants are postponing their search in the hope that market intervention will generate more affordable opportunities in the short term. Others are speeding up for antiestéticar that supply will shrink drastically. "This dual behaviour reflects the confusion created by an unstable regulatory framework, in which neither landlords nor tenants know which rules will govern their contracts in the coming months," Duque explains.

## The effect on home sales and the industry's proposals

The drop in rental supply has a knock-on effect on the home sales market. Tecnocasa points out that there may be implications on both the supply and demand sides. Since the Housing Law came into force, a significant number of landlords have been putting their homes up for sale. It remains to be seen whether the new measures reinforce that trend. On the demand side, the new subsidies may make it easier for certain eligible profiles to buy. Cubero notes that some caution is to be expected in the short term while the scope of the measures is analysed. "It will be especially important to watch what happens after **29 November**," he concludes.

FADEI is calling for a long-term residential strategy, not an accumulation of partial interventions driven by the political climate. Gómez Huecas insists that the housing crisis is structural and requires tackling its causes: speeding up housing construction, mobilising available land, cutting administrative delays, giving owners security and fostering cooperation between public authorities and the private sector. The association is calling for effective incentives to bring empty homes onto the market and mechanisms to expand the affordable housing stock without placing the entire burden on private individuals. It also asks the Government to abandon the pattern of emergency measures and open a genuine dialogue with public administrations to develop a housing policy with rigorous evaluation of its effects.

The real estate sector is not asking for miracles. It is asking to know where it stands. And until that happens, flats keep disappearing from the rental market. This article does not constitute financial or legal advice; for property decisions, consult a professional.