The deterioration of access to housing in Spain responds to the continuous increase in prices, which is driven more by wholesale and non-residential demand – which is usually more speculative – than by residential retail demand.
Housing encourages communities to participate and expand the youth rental bonus using their own funds
This is one of the main conclusions included in the latest issue of Funcas’ ‘Economic Information Notebooks’, which states that the difference between home purchase and sales transactions and mortgage contracts, with only four out of every 10 home buying and selling transactions are done at home. with a mortgage, suggests that a large part of the properties obtained for non-residential wholesale investment, which drives “prices even more and makes access difficult.”
In the same way, the authors of the study, Santiago Carbó and Francisco Rodríguez, point out that the scarcity of land and the increase in demand for housing are other reasons that increase the difficulty of accessing housing, as well as also in inadequate land policies. term and increase in demand.
This dynamic destroyed the affordability of housing, especially after the financial crisis and pandemic, where prices quickly recovered outpacing the growth of wages, according to the authors of the study.
Therefore, factors such as “inadequate” long-term land policies and the growth of demand exacerbate the problem, increasing the inequality between homeowners and those who cannot afford to buy a home. .
“Reducing housing affordability exacerbates inequality by taking advantage of homeowners and harming renters and families who cannot afford to buy a home,” they said.
In the opinion of the authors of the study, the solution is for those responsible for housing policies to rethink the promotion of property in favor of guaranteeing inclusive access to quality housing, which will include supporting a efficient rental market – abandoning interventions that increase. more prices– and more housing supply, including a larger public park in many cases.
Along these lines, they warn that the political answers to the problems of mortgage affordability are likely to be credit subsidies and the modification of mortgage contracts, strategies that “have not always obtained the expected consequences.”
“Often, the government’s support measures do not effectively prevent downward cycles in house prices and in some cases contribute to the prolongation of bubbles,” they warn.
Home appreciation: accumulating wealth
For their part, the authors Marina Asensio, Marina García and Daniel Manzano also point out that the valuation of assets such as housing is what allows the accumulation of wealth beyond the net acquisition of the assets themselves, where it “regularly materializes” savings. In the Spanish case, this effect can be responsible for almost three quarters of the increase in household wealth.
Likewise, although there are other factors, this can also explain to a large extent the greater concentration of wealth that has occurred, as illustrated by the highest percentage of wealth distribution. : the richest 1% of households hold 13.8% of the wealth. in 2002 and will reach 22% in 2020, according to the EFF. In turn, the richest 10% went from 43.9% to 53.9%.
More problems for young households
Along these lines, the authors also emphasize that young households have reduced home ownership to 35%, half a century ago (70%).
Thus, they ensure that this transition to a new “way of life” based on renting, also comes against the absence of a “really deep” market of this kind that prevents sharply increasing pressure on its prices.
However, they point out that Spanish households continue to have a preference for home ownership, despite the fact that the number of households with rental homes has doubled from 10% to 20%.