SPAIN’S government has approved a measure to make up to 50,000 foreclosed homes- held by ‘bad bank’ Sareb- available for low rentals to ease the housing crisis among young people.
Sareb was created in 2012 to take over more than €50 billion in real estate and other toxic assets from former savings banks that collapsed after the housing bubble burst.
Many grown-up children continue to live with their parents as they cannot afford to get on the property ladder or pay high rents, which are especially prevalent in big cities or coastal tourist areas.
Just 16% of young people in Spain live independently, compared to an average of 32% in Europe, according to the Observatory of Emancipation.
Housing Minister, Raquel Sanchez, said: “Young people and the not-so-young can’t pay for their rented apartments.”
“We think it’s a measure that will work and it’s not the only one that we’re putting on the table,” she told Antena 3 on Tuesday.
Out of the 50,000 total, 21,000 flats will be transferred for sale to the country’s regions and municipalities and then be used as social housing.
The process is similar to that in the Valencian Community which recently announced that it would acquire 500 homes from Sareb.
Exact locations have not been specified by the government, but it has said it will be indicative of the Sareb property portfolio.
It’s website features 46,542 homes with 29% of its flats in Catalunya, followed by 19% in the Valencian Community, 10% in Andalucia, and 7.5% in the Murcia region.
There has been criticism of the government move, which some see as a gimmick ahead of regional and local elections in May, as well as a general election before the end of the year.
Antonio Garamendi, president of the CEOE employers association, said that these ‘populist and interventionist’ measures would not solve the issue of rising rent prices but instead will ’cause the opposite of what is intended’.