Spain's housing crisis has a very simple solution
Two opposing recipes for the housing crisis: public intervention vs. total liberalization, plus the taboo option of expelling migrants. An analysis of the debate.
English · Original discussion in Spanish · Published
The housing crisis: two opposing recipes and one taboo solution
Spain's housing crisis has analysts split between two poles: a return to massive public intervention or the total liberalization of land. And, in a more radical corner, the expulsion of migrants. The debate, intense and devoid of moderation, reveals that there is neither consensus nor the political will to apply any of the recipes.
The public model: merging municipalities and building from the state
One camp argues that the solution rests on three pillars: merging all the municipalities of each metropolitan area into a single entity to end local land speculation, creating a 100% state-owned construction company that develops housing at cost price, and restoring public banking to finance non-profit developments. They argue that the model worked during the Franco era — when 4 million workers' homes were built in just ten years — and that, since the transition to democracy, liberal speculation has pushed prices to unsustainable levels. Critics reply that the public savings banks went bust and that any state-run outfit ends up in the hands of corrupt politicians.
The liberal recipe: free up land and scrap taxes
On the opposite side, the argument is that public intervention is the problem, not the solution. The proposal: all non-protected land should be buildable, and first homes should be exempt from taxes and fees. They also advocate simplifying regulations in the style of the 1970s, but building with triple the heights to cut costs. They point out that today half the price of a new home corresponds to taxes and regulated land. Supporters of this route cite the example of India — where deregulation has generated urban chaos — but also that of the mass construction of the development boom, when the Franco regime freed up land with hardly any restrictions.
The elephant in the room: immigration
A third position, minority but loud, holds that the only real solution is to expel the 12-15 million migrants who, by their calculations, have arrived in recent decades. They argue that this measure would free up millions of homes and ease pressure on the labour market, reducing wage dumping. However, they face practical objections: the political and logistical cost of mass deportation, and the question of who would fill the jobs those migrants cover today.
None of the three visions enjoys majority political backing; the radical measures clash with European law, property interests and the lack of will of successive governments. The data nobody quite manages to explain is why, with an estimated stock of more than 3 million empty homes, no mechanisms are activated to bring them to market. Perhaps the simplest solution is the one least discussed: there is no interest in prices falling.
Related debates in the forum
Spain's housing crisis has analysts split between two poles: a return to massive public intervention or the total liberalization of land. And, in a more radical corner, the expulsion of migrants. The debate, intense and devoid of moderation, reveals that there is neither consensus nor the political will to apply any of the recipes.
The public model: merging municipalities and building from the state
One camp argues that the solution rests on three pillars: merging all the municipalities of each metropolitan area into a single entity to end local land speculation, creating a 100% state-owned construction company that develops housing at cost price, and restoring public banking to finance non-profit developments. They argue that the model worked during the Franco era — when 4 million workers' homes were built in just ten years — and that, since the transition to democracy, liberal speculation has pushed prices to unsustainable levels. Critics reply that the public savings banks went bust and that any state-run outfit ends up in the hands of corrupt politicians.
The liberal recipe: free up land and scrap taxes
On the opposite side, the argument is that public intervention is the problem, not the solution. The proposal: all non-protected land should be buildable, and first homes should be exempt from taxes and fees. They also advocate simplifying regulations in the style of the 1970s, but building with triple the heights to cut costs. They point out that today half the price of a new home corresponds to taxes and regulated land. Supporters of this route cite the example of India — where deregulation has generated urban chaos — but also that of the mass construction of the development boom, when the Franco regime freed up land with hardly any restrictions.
The elephant in the room: immigration
A third position, minority but loud, holds that the only real solution is to expel the 12-15 million migrants who, by their calculations, have arrived in recent decades. They argue that this measure would free up millions of homes and ease pressure on the labour market, reducing wage dumping. However, they face practical objections: the political and logistical cost of mass deportation, and the question of who would fill the jobs those migrants cover today.
None of the three visions enjoys majority political backing; the radical measures clash with European law, property interests and the lack of will of successive governments. The data nobody quite manages to explain is why, with an estimated stock of more than 3 million empty homes, no mechanisms are activated to bring them to market. Perhaps the simplest solution is the one least discussed: there is no interest in prices falling.
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (47 replies).
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