MARKET regulation in Barcelona has pushed property prices down, a new report has shown, while Madrid continues to struggle with rising rents and purchase costs.
As of September last year, households in Barcelona needed an average of 13 years to pay off their mortgages, compared with 16 years in Madrid, according to Caixabank Research.
A similar pattern is visible in the rental market, where annual rent in Barcelona accounted for roughly 35% of average household income in December last year. In Madrid, where the property market remains unregulated, that figure exceeded 37%.
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The shift follows Barcelona’s decision to introduce rent caps across 140 municipalities in March 2024, after which the average price of new rental agreements fell by nearly 5%, according to the city’s Metropolitan Housing Observatory.
Spain has been grappling with soaring housing costs for more than five years, a trend that has left vulnerable groups and many young people priced out of the market.
The surge has largely been driven by a mismatch between supply and demand, with the growing influx of foreign-born residents adding further pressure to an already strained housing system.
Despite Barcelona’s figures, Madrid’s regional governor Isabel Ayuso criticised the Catalan capital, arguing that the number of rental properties had declined following the new regulations.
However, the Observatory’s data indicates that there are currently around 1,500 more listings than in March last year.
Housing experts now warn that Madrid’s rental market may be undergoing a quieter transformation, with thousands of homes reportedly shifting from long-term leases to more profitable short-term and seasonal arrangements.
Left-wing party Mas Madrid claims that more than 2,000 seasonal rental units appeared in just one quarter of 2025, fuelling concerns that landlords are prioritising higher returns over housing stability.
The development has intensified political tensions, with calls for urgent measures to prevent what the party describes as the “hollowing out” of the permanent rental market.
Catalonia has already moved to tighten regulations, requiring seasonal and room rentals to comply with official pricing limits in an effort to prevent investors from bypassing controls.
Meanwhile, Mas Madrid is pushing for sweeping reforms, including a major expansion of public housing and steps to ensure subsidised homes remain permanently protected.
At the national level, Prime Minister Pedro Sanchez’s government has also stepped up its response to Spain’s housing crisis through a combination of regulation and enforcement.
In one of the most significant actions to date, authorities last year removed around 60,000 non-compliant tourist rental listings, targeting what officials see as a key driver of escalating urban rents.
The government argues that the crackdown is essential to easing supply pressures in overheated cities, where the rapid growth of holiday rentals has been blamed for displacing residents.
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