Sánchez's Promises Fade as Left Defends Franco-Era Rent Controls

The promises of housing made by **Pedro Sánchez**'s government have largely proven to be empty announcements, with minimal execution against the figures promised, while policies that reduce supply and penalize investment remain in place.

## The Gap Between Promises and Reality in Housing Policy

For years, we've heard millionaire promises about the creation of thousands of affordable homes in Spain, especially since **Pedro Sánchez** came to La Moncloa. The idea is for the state to intervene to guarantee access to a home, but the reality after eight years of government shows a considerable gap between what was announced and what has been executed. Hundreds of thousands of public housing units are mentioned, but the figures that actually materialize are much lower. For example, in July **2024**, a plan for **43,000** homes for social and affordable rent was announced, financed with **6 billion** euros from the ICO. This program was part of a more ambitious goal of making over **180,000** homes available. However, the Executive itself has acknowledged that **18,000** units will not be reached. The problem is not so much a lack of announcements, but poor execution. Spain needs much more housing, but current policy seems to focus more on headlines than on actual construction.

As of April **2026**, the government spoke of **120,479** 'mobilized' homes within its target of **183,000**. But this label hides a problem: it doesn't miccionan homes built, delivered, and available for a family. The Executive is reluctant to provide concrete data on how many homes are actually built and delivered, suggesting the figure is, at best, disappointing. If we look at a broader count, **276,000** protected housing units and over **400,000** total homes were announced in six years. The reality, however, is that since **2021**, about **49,000** units have been delivered. Families don't rent announcements; they need houses. The **Banco de España** has already pointed out that the supply of residential rentals has grown insufficiently to absorb sustained demand, leading to persistent price increases.

## The Persistence of "Old Rents" and State Intervention

There's a paradox that the left seems to avoid debating: while criticizing the "rent-seeking" of a small landlord renting out a property, it fervently defends an even more marked form of privilege. This refers to those who enjoy the right to occupy a home with an artificially frozen rent for decades. These "old rents" are a vestige of rent regulation from the Franco era. For years, many landlords received amounts disconnected from real maintenance costs, inflation, community fees, taxes, or market value. The Urban Leases Law of **1994** attempted to end this model, recognizing that a private contract turned into an almost perpetual obligation was incompatible with a functional rental market.

Defending the perpetuation of these situations without nuance is not defending the right to housing. It's demanding that a private owner, often a family or a small business, bear a social burden that should be funded by the state, which already collects a considerable amount in taxes. Solidarity should be a public responsibility. If someone needs help to avoid losing their home, the state has tools: social housing, direct aid, residences, public housing, professional mediation, or social services. What it cannot do is turn the private owner into a public housing department, without budget, compensation, or time limits. It is particularly striking that those who denounce any economic "privilege" simultaneously defend that the price of a private asset remains frozen indefinitely. That is not social justice, it is political arbitrariness.

## Banco de España Warns: Price Controls and Supply Shortages

The political temptation to control prices is often pure demagoguery. Governments don't control prices; they often raise them. Such a measure doesn't solve the problem; it worsens it. It doesn't build additional housing, turn non-developable land into buildable, or estimulante ilegal up permits. On the contrary, it quickly eliminates supply. A clear example is Berlin's controversial rent freeze law, known as Mietendeckel, implemented in February **2020**. According to the IFO Institute, it caused a drop of up to **60%** in the supply of housing available for rent in the regulated sector.

The **Banco de España** has warned that limits on rent increases significantly raise the price of new contracts. It has also alerted that price controls and certain tax incentives can reduce rental supply and distort the market. If a landlord perceives that they cannot update rent in line with costs, risk, and inflation, they will have more incentive to not rent, sell the property, repurpose it, or select tenants more restrictively. The result is not cheaper housing for everyone, but a market with less available housing, higher access barriers, and a more pronounced price jump for those entering for the first time. The tragedy of this policy is that it protects the existing tenant and penalizes the young person, the worker changing cities, the family going through a separation, or the student looking for their first rental. It's a policy that creates "insiders" and "outsiders," the opposite of social policy.

## The Need to Liberalize Land and Streamline Procedures

The accumulated deficit illustrates the magnitude of the problem. Between **2021** and **2025**, the **Banco de España** estimates that Spain accumulated a shortfall of nearly **750,000** homes. Between **2022** and **2024**, approximately **345,000** building permits were granted compared to a net formation of **604,000** households. This gap cannot be solved with a price cap law, a campaign against landlords, or a new public agency. Scarcity isn't created by investment; it's created when supply cannot meet demand. Spain needs housing in major urban areas, in municipalities where employment is concentrated, in university towns, and in areas connected by infrastructure.

The **OECD** has expressly asked Spain to accelerate and digitize urban planning procedures, release developable land in areas of high demand, and strengthen legal certainty to attract investment. It also warns that social housing in Spain represents only **3%** of the stock, below European benchmarks, and estimates that the country would need about **850,000** additional social housing units to approach the European Union average. The underlying problem is that Spain doesn't have enough supply. What is a problem today will soon be a crisis. Priorities must be clear: release land where there is demand, increase density and building in well-connected areas, shorten permit times, apply positive administrative silence with guarantees, reform the Land Law with stable rules, reduce litigation, and offer legal certainty to developers, landlords, and buyers. Directing aid to vulnerable households, not freezing the market, providing security to small landlords, and reducing taxes that increase access costs are also crucial steps. Lower taxes on transfers, construction, and rehabilitation would help mobilize housing. Even the **OECD** has recommended reviewing taxes that can distort the market.