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The Mayoress has spoken out about rising rents in Barcelona, warning of speculation and a new bubble in the housing market.
Ada Colau, the left wing Mayoress of Barcelona (pictured above), has used her blog and a press conference to denounce speculation and urge the Spanish Government and the Generalitat – the regional Government of Catalonia – to introduce rent controls to stop cost rising.
Colau says she wants to raise the alarm in the light of a “worrying increase” in rental prices in the Catalan capital, where rents averaged 765 €/month (11.5 €/sqm/month) at the end of Q3 last year (according to City Hall data), an annualised increase of 9%. Speaking at a press conference Colau said rents have risen more in Barcelona’s property market than anywhere else in Spain.
“We are witnessing a worrying increase in rental prices in Barcelona, and it is our duty to warn of the growth of a new speculative bubble in the housing sector,” she says.
“We want to remind the State and the Generalitat of the disaster resulting from a failure to act in time when signs were first detected of the last bubble, the bursting of which had terrible consequences for thousands and thousands of families.”
Speaking to the press, Colau said the state is failing to regulate the market properly, and allowing speculation to inflating another bubble as a consequence.
Colau calls on the “State” (Madrid) to introduce the “necessary mechanisms to regulate the rental market, like they do in Germany and other European countries.” She sees rent controls as the answer to rising rental prices in Barcelona, where the housing market is already highly regulated.
Rents may be rising in Barcelona, but other sources suggest falling rents in most parts of Spain, making it difficult for the State to justify rent controls. The latest rental prices index produced by the company Alquiler Seguro has average rents falling by 0.64% in February compared to a year before, whilst the rental price index published by the National Institute of Statistics shows average rents falling 0.3% in February, after almost three years of consecutive declines.
Colau came to prominence as an activist leader fighting against home repossessions, and went on to conquer Barcelona City Hall. You can watch her denouncing speculation and warning of a fresh housing bubble in the press conference video below (relevant section is roughly between 9.00 and 15.00)
[youtube id=“hgVbI0PEp0Q”]
+ Video at Youtube
Carlos says:
This is what happens when you invite speculative institutional capital to come in to prop up housing prices.
Campbell Ferguson says:
Over many cities and many countries and decades, assuming everything is equal, the only way to stop rents rising is to increase supply. What has Barcelona done? They’ve stopped supply dead by insisting on licencing of temporary lets and then stopping issuing the licences. So those that have can increase rents without competition and properties with licences are more expensive to buy and so higher rents are required to give the owner a decent return. Want to lower the rents? – immediately issue more licences (why was it stopped in the first place?). Licencing to ensure quality and safety is a good thing, but they’ve mucked up supply and demand so it achieves a new balance at higher rents.
GarySFBCN says:
Campbell, that is not true. There is construction all over Barcelona. The supply is increasing. What was stopped is the eviction of long-time residents in order for a few to make a lot of money by renting flats to tourists.
Entire neighborhoods were affected by the tourist rentals and thankfully it was slowed. There are still many illegal rentals listed on the various sites.
There are many who fear that if nothing was done, Barcelona would be the next Venice – a city overrun with tourists and few actual residents. The number of tourist who visited Barcelona more than doubles since 2000. It feels out of control. Even the ‘out of the way’ places are now overwhelmed by tourists. There needs to be some balance.
rojoybago says:
rising rents?,NO, only in the posh areas !! Balance GarySFBCN?, well, cut the tourist numbers and up goes unemployment?; it’s what she wants anyway, more dependent reliant voters. Let’s not forget she is a die hard marxist and nationalist who hates five star hotels, fancy restaurants etc , maybe she wants to recreate Cuba here?
GarySFBCN says:
Do you live in Barcelona? If so, you would know that the city is overrun with tourists. They had to start charging admission to a public park just to control the crowds. As for your claim that the rents are rising only in the ‘posh areas’, apparently you have difficulties reading the table above that shows the rents going up city-wide.
As for your red-baiting, that speaks to your character, not the mayor’s.