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PROPERTY

Property news in Spain: build-to-rent trend takes off and big opposition to new housing laws

In this week's roundup of top property news from Spain we look at why some homeowners are rushing to sell, financing for non-resident buyers and why building to rent is currently very popular.

man and woman sit on balcony in flat in Spain
If you spend less than 183 days in Spain you are less likely to get financing for a Spanish mortgage. Photo: OSCAR DEL POZO / AFP

Companies own more property than ever 

Out of the more than 4 million property purchases recorded over the last 12 years in Spain, 1.7 million were bought up by firms or legal entities with more than 8 properties in their name already. 

This is according to new data from Spain’s Cadastre General Directory, which highlights how investment firms – known as vulture funds (fondos buitre) in Spain – have influenced Spain’s property market over the past decade.

Legal entities (personas jurídicas – an individual, company, or organisation which has legal rights and obligations – can deduct up to 85 percent of tax from their earnings if they have 8 or more properties. 

Build-to-rent in Spain on the up

This emerging submarket on the rise elsewhere in the world is becoming increasingly popular in Spain as it addresses a gap in the market. 

The benefits it brings are increasing the availability of properties for rent in Spain – which make up only 25 percent of the total – and in the process offer homes which are more adapted to current demands by tenants after the pandemic.

Young property hunters, many of whom are working from home, are looking for homes with more light, space, terraces and gardens, all features that are uncommon in old Spanish homes in city centre locations. 

Investors are now looking to take advantage of this rising demand and lack of supply.  

According to a study by BNP Paribas Real Estate, 17,000 build-to-rent flats will be built in Spain in the next two years and by 2028 there will be 85,000 build-to-rent units in the country. 

New housing laws unlikely to be applied throughout Spain

The Spanish government’s proposed changes to the country’s housing laws –  including price freezes, €250 rental allowances for young mid-income earners and  big tax hikes on empty homes – have been slammed by Popular Party, the main opposition party. 

Even if the measures were approved by the Spanish cabinet, regional governments and town halls have the final say on whether they come into force. 

PP leader Pablo Casado, who referred to PSOE and Unidas Podemos’s draft housing law as “suicidal interventionism”, has since said that in autonomous communities and cities where his party is in power, the proposals will never come to fruition. 

This includes the governments of Andalusia, Galicia, Madrid, Murcia and Castilla y  León, which have a total population of around 21 million people. 

“We’re not going to raise property tax on empty homes,” Madrid’s right-wing mayor José Luis Martínez Almedia has already declared.

EXPLAINED: Spain’s proposed new housing laws 

Some property owners are rushing to sell 

Even though it’s yet to be approved and was only announced last week, Pedro Sánchez’s proposed changes to Spain’s housing and renting laws have already caused a rise in the number of property owners choosing to put their homes on the market rather than continue letting them out or leaving them empty. 

According to Antonio Carroza of Alquiler Seguro (Safe Renting), a company specialising in protecting landlord from delays in payment, there’s already been a rise of 15 percent in the number of clients who want to sell their properties as soon as possible to sidestep the higher taxes on empty homes, or rent them out before rent caps are introduced.

“Most of these properties are in the hands of individual owners; and when a problem like this arises, they take their houses off the rental market,” Carroza told El Confidencial Digital. 

According to Carroza, for large investment funds who previously treated the two Iberian markets almost as a single entity, Portugal now offers more alluring tax conditions and benefits than Spain. 

Which Spanish regions require a building permit to install solar panels at home?

On Sunday October 10th, Madrid became the latest region to scrap this bureaucratic step from its requirements for installing solar panels.

That means that as things stand, the regions which don’t require this complex and time-consuming documentation are Madrid, Andalucía, Aragón, Catalonia, Castilla y León, Castilla-La Mancha, Valencian Community, Extremadura, Galicia, Balearic Islands, Canary Islands, Navarre.

The Spanish regions that still require planning permission are Asturias, Cantabria, Basque Country, La Rioja, Murcia.

However, even if you’re region doesn’t require a permit, there’s other paperwork which you may be asked for from local authoties when installing solar panels, which you can check out here

Did you know? Non-resident buyers get less financing

If you spend less than 183 days in Spain you are less likely to get financing for a Spanish mortgage and will have to put a bigger amount down initially. 

Whereas residents will usually be lent around 70 to 80 percent of the total property amount to be paid and get better interest rates, non-residents can only expect a Spanish bank to cover 60 percent of the cost. 

This is due to the fact that if Spanish Banks pursue assets in the event of a default, the only thing they could have access to would be the property in Spain.

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PROPERTY

EXPLAINED: What you need to know about locksmiths in Spain

If you get locked out, have a break-in or need to change or fix the door lock at your home in Spain, here are the rates and advice you need before calling a Spanish locksmith (cerrajero).

EXPLAINED: What you need to know about locksmiths in Spain

Like anywhere, locksmiths are generally expensive and the price can vary greatly depending on the service you need and where you are.

It also depends on when you need them, as it’ll cost much more to call them out on a Saturday night than a Monday morning, for example.

Nor would it cost the same to open your front door as it would a reinforced security door.

But locksmiths don’t just make copies of keys and bail you out when you’re stuck outside your flat.

They also offer a whole host of different services including, but not limited to, opening safes, creating master keys, installing security doors, anti-drill doors, cutting specialist locks that reject copied keys, and even unlocking the boot of your car.

How much does a locksmith cost in Spain?

Given all these variables, the price can range massively.

According to Cronoshare, the average price for a nationwide call out in Spain can start from €80 anywhere up to €400.

On average, for a basic service, you can expect to pay anywhere between €40-€70 an hour for the labour, with the price of changing or installing a basic lock anywhere between €80-€200. 

For basic door openings, it depends on the situation you find yourself in: for doors locked with a key, which is a more complex task, prices average around €200, and for doors that are jammed or slammed shut, slightly cheaper in the €80-€100 range.

For an armoured or security door, prices can start at around €300.

In short, a general rule is that the more complex the task is, the higher the prices.

And as always, prices can vary depending on where you are in Spain, the quality of the locksmith, the time of the day and week you need his or her services, and if its a public holiday or not. 

So, as always, compare prices to try and find the most economical solution without skimping on quality.

As such, the following rates are estimations taken from average prices from locksmith.

Weekend/holiday rates

Where prices can really start to add up, however, is when you have an emergency situation requiring a locksmith’s assistance at the weekend, on a public holiday, or outside of normal working hours.

And if you live in Spain, you probably know there’s quite a few of those days throughout the year.

If you really need a cerrajero on a public holiday or during non-working hours (usually defined as anything between 8pm-8am) prices can reach €300 or €500 due to the fact you’ll have to cover the cost of travel, which starts from around €40 plus the increased rate.

Then you must also include the price of labour to the flat rate, which is usually somewhere between €40 and €70 an hour regardless of when you call them out.

Key vocabulary 

We’ve put together some of the basic vocabulary you might need if you find yourself needing a locksmith while in Spain.

el cerrajero – locksmith

la llave – the key

la llave de repuesto – the spare key

la puerta – the door

la cerradura – the lock

la bisagra – the hinge

día festivo – public holiday

cambio de bombín – change of cylinder lock

puerta blindada – armoured door

coste de mano de obra – labour costs

quedarse afuera – get locked out 

puerta cerrada de un portazo – door slammed shut

puerta cerrada con llave – locked door

Tips relating to choosing a good locksmith in Spain 

If you’ve just started renting a new place or have bought a property, it’s advisable to change the lock as you don’t know who has keys to your front door. If you’re a tenant, try to negotiate this with your landlord as it’s in both of your interests that only you two have keys to the property.

If there has been a burglary in your property while you’re living in it and there’s no sign of forced entry, then there’s a very big chance that the burglars had a copy of your keys, and you should definitely change the locks. 

If you’ve lost your keys and you think it happened close to your home, again it’s advisable for you to change the locks.

One of the best ways to avoid being locked out and having to cough up a hefty sum is to give a spare set to someone that you trust that lives in your town or city in Spain. 

When it comes to choosing a locksmith in Spain, you should make sure he or she is a reputable one. Asking friends and family first can be your first port of call.

If not, make sure you read reviews online if available to get any insight beforehand.

In order to avoid any nasty surprises, ask them on the phone for a budget (presupuesto) for all the costs attached to their services before accepting.

Be wary of cerrajeros that automatically want to change the whole lock when a simpler and less costly option is possible. 

Usually they should offer you a contract for you to read carefully before signing. It should include a three-month guarantee for the potential new lock or at least a breakdown of the costs.

Make sure that they are not charging you an excessively high price if it’s an emergency, as this is not actually legal.

There’s also asking them to prove their accreditation with the Unión Cerrajeros de Seguridad (UCES).

Weekend and holiday rates can be higher nonetheless, so consider your options and if it’s worth staying with a friend or family member for a night to save some money. A trustworthy and honest cerrajero will let you know about the money you could save if you choose to wait as well.

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