Sánchez convenes banks and developers in Madrid to tackle housing crisis

Sánchez meets banks, developers, and unions over housing

The banking sector did not see this coming. Used to dealing with the Ministry of Economy, they found themselves summoned by the Prime Minister's Office. Pedro Sánchez has called for a meeting on Thursday at 10:30 a.m. at the Moncloa Palace for top executives from the financial, real estate, and union sectors to discuss housing policy and financing shortages. The official reason is technical; the unofficial one admits an electoral reading, with Basque and Catalan elections on the calendar. None of this is neutral: everyone sitting at that table has something at stake.

Who sits at the Moncloa table

Sánchez is not alone. With him will be the Minister of Housing, Isabel Rodríguez; the Secretary of State for Housing, David Lucas; the Secretary General of Urban Agenda, Iñaqui Carnicero, and the Secretary of the Presidency, Judit Alexandra González Pedraz. On the other side, the president of APCE, Juan Antonio Gómez Pintado; the president of Concovi, Juan Casares, and the president of AGV, Juan José Perucho, representing the developer bloc. The AEB of Alejandra Kindelán and the Ceca of José María Méndez represent the banks, with Pedro Fernández Alén heading the construction employers' association, CNC. CCOO and UGT close the list of invitees. Divergent interests in a single table. Some warn that such a forum only works if public land, held by administrations, is offered at a reasonable price and stops being treated as a speculative asset.

Why banks are wary of the Moncloa meeting?

Financial institutions have accumulated two channels of exposure to real estate: foreclosed assets, reduced in recent years, and financing. Negotiations between the Executive and banks remain unresolved, and the meeting is shadowed by suspicions that it is a prelude to an election-biased announcement. The context does not help: in March, US inflation rose to 3.5% and core inflation to 3.8%, cooling rate cut expectations, and Brent oil exceeded $90. With this backdrop, cheap financing is not readily available.

The bottleneck dragging construction since the bubble

The sector has long called for a new Land Law to facilitate use changes, the De-indexation Law that prohibited price reviews, and a cap on the Public Sector Contracts Law. Also on the table are housing taxation, guarantees, and loans needed to generalize industrialized construction. But the problem that cannot be solved by decrees is the lack of labor. In mountain villages in Catalonia and Aragon, ski resort and tourism workers spend the season in caravans and vans because they cannot afford rent. The lack of affordable housing also drives out teachers and healthcare workers who could settle in the Pyrenees. And it is pointed out in the debate that sleeping in a car is also illegal.

Public aid that ends up in prices

One strand of analysis holds that much of the aid for buying and renting ends up captured by banks and landlords. The mechanism is simple: the more public money enters the market, the more room there is to raise prices. Tenant aid degenerates into rent hikes. This is the same objection raised regarding electricity measures, when bills ended up higher than before. Others add a nuance that bothers both sides: if real supply does not increase, any subsidy only moves money around and accelerates the bubble.

Promised public housing and the noise over squatting

Whenever housing is discussed, the same front reappears: promised but undelivered public housing. Questions arise about where the 200,000 public housing units promised are, and whether the plan will reach those who need it. Meanwhile, some property owners demand tough action against illegal squatting, which they see as a brake on getting flats onto the market. The two demands sit uneasily together: demanding more public supply while simultaneously sending signals of legal certainty to private owners. Someone will have to decide which weighs more on the scale.

The clash between rentierism and housing as a right

Much of the discontent points to a real estate park turned into a value refuge. There is close scrutiny of the so-called golden visa, the Housing Law, and stressed market zones, described as precursors of stricter measures. Owners respond that without them there is no new supply and that legal uncertainty deters investment. The tension is not just Spanish. In Vietnam, a court sentenced a real estate magnate to death for one of the country's largest corruption cases, with estimated damages of $27 billion. The anecdote does not invite extrapolation, but it shows how far punishment for real estate can go when the scandal is massive.

That housing is today a problem of access and supply is admitted by almost all interlocutors. That the Moncloa table serves for anything more than a photo, no one signs off on. What if the solution dilutes as soon as the electoral calendar passes?