Spain's PSOE plays election card with housing decree

Spain's PSOE plays election card with housing decree

The Council of Ministers approves two housing decrees with a financing line of €10 billion in loans of up to €50,000. The measure, presented as a boost to affordable renting and home buying, has been met with skepticism in economic forums, where it is seen as an electoral move ahead of a possible early general election. The debate, which has accumulated 239 responses in four days, mixes analysis of the decree with speculation about election dates and the impact on the real estate market.

What does the housing decree approved by the government contain?

The package includes 21 measures to facilitate access to renting and buying, create more supply and combat speculation. The centerpiece is a €10 billion financing line that will offer loans of up to €50,000. According to the official announcement, the goal is to give stability to tenants and buyers. However, critical analysis suggests it is an injection of public money that could end up in the hands of speculators, reproducing the subprime mortgage model that triggered the 2008 crisis. The comparison with the bank bailout measures of the Zapatero era is recurrent: then toxic assets were bought to save the big banks; now the risk would be assumed by the State, which would not recover the funds.

Why is it interpreted as an early election?

The coincidence of the decree with a climate of rumors about early elections has sparked speculation. The IBEX, which was in the red, shot up as soon as the election rumor arrived, according to the debate. The dominant hypothesis is that the government is looking for an excuse to call elections before a judicial case erupts or the economic situation deteriorates further. Some argue that Prime Minister Sánchez had already decided on the early election and that the decree is just the pretext. On the other hand, others argue that he had no need to create this stir just to pass a housing law, which reinforces the electoral thesis. The date being considered, November 29, is mentioned in several messages.

The impact on the real estate market: will prices fall?

The majority opinion in the forum is that housing prices will not fall. It is argued that 78% of Spaniards are homeowners and that any measure that endangers private property generates rejection. Small owners, according to this view, will end up losing their properties to large funds, which have the capacity to wait a decade until the rescued assets become profitable. The calculation being handled is that the funds have been waiting more than ten years to make profitable what in 2008 were toxic assets bought with public money. The conclusion is that the market is heading towards greater concentration and that small investors will not be able to compete with funds on a 10-15 year horizon.

The division on the left and the wear and tear on the PSOE

The debate reflects a fracture in the left-wing space. On the one hand, critics of the government point out that the PSOE will not change anything substantial and that it applies the same policies as the right on economic matters. On the other, defenders argue that measures such as the housing decree are social pogre. The discussion also addresses the wear and tear on the PSOE: it is mentioned that its vote bank is the older population, which already owns property, while working-class neighborhoods deteriorate. Corruption and judicial cases hover over the analysis, with references to the grandchildren law and the need for fictitious votes to govern. The conclusion is that the PSOE is in its final throes, although others believe it will rise like a phoenix.

The role of judges and the paralysis of cases

An unwritten rule, mentioned in the debate, establishes that judges do not issue rulings during election campaigns so as not to influence the vote. This fuels the theory that an early election would paralyze the judicial cases affecting the government. The case of SEPI, Venezuelan oil and the wineries in the Plus Ultra flights are cited as investigations that could be frozen. The opposition, for its part, warns of a possible rigging and questions postal voting, while the prime minister defends its legality. The IBEX, according to this reading, would be interested in ousting the prime minister before the drug and money laundering case breaks out.

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The housing decree and the early election have revived the debate on the economic model. With 78% of Spaniards owning property, any measure that threatens private property generates majority rejection. Investment funds, meanwhile, wait for their moment. The question floating in the air is whether the PSOE will achieve its goal or whether, on the contrary, it will backfire. What is clear is that housing remains the issue that generates the most tension.