The Official State Gazette will soon publish a new mechanism that could lead to a revolution in the search for housing.
Housing is currently one of the most politically controversial issues. Attempts to tame the situation continue without the administrations having achieved their objective: the owner continues to decide when and how much to rent his or her home. The latest measure that will soon come into force will be to set a reference index through which the government will determine the amount, between a minimum and a maximum, at which a property can be rented. This measure is not a current occurrence, but comes from the new Housing Law, a regulation that came into force on 26 May 2023, before the general elections in July. Now it remains to be seen how it affects the new rental price of flats in Valencia, as any owner can consult these limits indicated by the Government and download the report to find out what the value of their rented property should be. For now, the regulation will only apply to areas considered to be under stress, a declaration that has not yet been made in any part of the Valencian Community.
In NUWE we explain all the details of the latest measure announced by the Government to try to control and dominate the price of rental housing.
- When the new rental price comes into force
- Who is a great fork of flats
- What is a tensioned zone
- What are the stressed areas in Valencia, Alicante and Castellón?
- How to download the Rental Price Reference Information Certificate
When the new rental price comes into force
If the deadlines set by the Government itself are met, it will be part of the 13 March when this new limit on rental prices for areas considered to be under stress will be taken into account. This is when the Boletín Oficial del Estado (Official State Gazette) will report on the new regulatory text that will attempt, once again, the control by the administration of the price that each owner sets for renting a property. The focus is now on two issues: large tenants and stressed areas. The truth is that, in the case of the delimitation of areas with a lack of supply and excess demand for the rental of flats, the measure is exclusively of an autonomous nature. For the time being, the stressed areas are only indicated in the autonomous community of Catalonia, a region which, for its part, has opposed the central government being the one to determine the limits on rental prices.
Who is a great floor-holder: the public enemy?
This is one of the keys to the new Housing Law, a regulation that in its first year in force has not served to substantially reverse the dynamic in terms of both regular and holiday home rentals. Prices have continued to rise over the last few months and the trend in the sector is for them to continue to rise, ignoring any political control. The regulation that came into force in May 2023 puts the spotlight on one type of owner. This is how the term 'large tenant' came about, an attempt to stereotype landlords with several dwellings. As if it were the great enemy, the Government states that anyone who appears as the owner of more than 10 urban properties, properties that do not include garages and storage rooms, or who has a building surface area of more than 1,500 square metres for residential use, will be called a 'large holder'. The designation does not stop there, but extends to the assumption to anyone who has 5 properties within the same 'stressed zone'.
What is a tensioned zone
For more than half a year, the Executive has been trying to put a stop to a completely free system in which supply and demand are adjusted and in which the market situation does not understand rules or public controls. This is how forceful the sector has been since May. The influence, for the time being, of the law is serving to ensure that the market has generated its own system that circumvents any attempt at public interference. The result is an almost uncontrolled rise in rental prices. It is in this context that one must understand the government's insistence on one of the most prominent measures of the new Housing Law: 'stressed areas'. This is the term chosen to indicate those areas in which there is considered to be a lack of supply and excess demand for rented flats. In other words, locations in which the interest in renting a home exceeds the number of houses available for rent.
What are the best areas to rent flats in Valencia, Alicante and Castellón?
In view of the name given in the Law, concern arises as to who and how it is decreed that an area is declared a 'tensioned zone'. Who determines the 'tensioned zones' in each locality: the government, the autonomous community or the city council? The Executive is the one that has published the regulation and the one that opens the possibility of these locations being designated, but the final decision depends on the administrations closest to the citizen. Currently, only the autonomous community of Catalonia has decreed a total of 140 areas as a 'tensioned zone' for rental housing. No other regional government has joined the central government's plan. So in Valencia, Alicante and Castellón there are, to date, no locations that have been specially catalogued due to the complexity of finding rented housing.
How to download the Rental Price Reference Information Certificate
Expected between 12 and 13 March a new aspect of the Housing Law will be published in the Official State Gazette: the reference index. As we have already mentioned, the regulation has not served to sustain housing rental prices. Quite the contrary. They are increasingly higher, in line with increases in the CPI, as well as other day-to-day expenses of the Spanish population. The website of the Ministry of Housing and Urban Agenda already has a consultation tool that can be useful for a regular owner and that can become a headache for the so-called 'big tenants'. Therein lies the key to this tool.
Apparently, the search engine looks like a consultation page where you can find a minimum and a maximum price at which the property in question 'should' be rented according to various characteristics of the property. The website contains official data, so that the search can even be done by cadastral reference or even using the address of any property. On this website it is possible to add or remove specific aspects of the property in question, such as whether it has a car park, whether it is furnished or whether the property has various communal areas. At the bottom of the page there is a window in which the minimum and maximum figures change for each piece of information provided. How to download the informative rental price reference certificate is quite simple: it is prominently displayed on the same web page.
The key to this document is that these amounts could be a challenge for the 'big tenants', as the new change in the Housing Law is that the price of renting a home will oscillate within this range on certain occasions. In other words, the Government will impose the minimum and maximum rent for a property. This will not be generalised from the second half of March, as the Executive points out that only new contracts for large tenants and flats that have not been rented before in stressed areas during the last five years will be linked to these reference limits. In other words, the new rental contract made by a 'large tenant' will have to have a price that is set between the lower reference price of the previous agreement and the higher value of the new price index.