The OECD sees aid to tenants as a more effective measure
The Organization for Economic Cooperation and Development (OECD) considers that rental subsidies can play a “relevant role” when it comes to defraying the cost of renting, especially in low- and medium-income households. In its report ‘Economic Study of Spain, 2025’, which it publishes biannually, the organization states that a more “effective” system that would consolidate existing programs into a national scheme and that would be selective according to income and linked to local leases “would improve equity” and would reduce market distortions.
“Spain currently offers limited rental assistance, often through regional programs, and the system remains fragmented, with “poor funding and ineffective targeting”he points out, while emphasizing that any expansion should be coordinated with initiatives aimed at strengthening supply. “Misdirected subsidies in a tight market can cause prices to rise of housing and rents, disproportionately benefiting landlords, who capture a significant part of the subsidy through increased rents,” they warn.
The ‘think tank’ of developed economies thus highlights this measure compared to others in force, such as the imposition of a maximum limit on the rise of the rental price, whose “effectiveness” It may be more limited if it is not accompanied by a greater supply of houses, an argument based on what happened in countries such as the United States and the United Kingdom. A similar position is held regarding the proposal to apply a tax on empty homesbecause although “well-intentioned” he qualifies his approach as “complex to implement.” “Portugal’s experience with the empty homes tax shows that implementation challenges and limited local capacity can weaken its effectiveness“, he maintains, while urging to define what is considered empty housing, as well as to adopt a tax system that increases depending on the duration of the stay and the place in which it is located.
The document states that in Spain there are some 3.8 million uninhabited houses. The problem lies, however, in that most of them are in places where “people don’t want to live” due to the lack of job opportunities and its distance from services. In this sense, they estimate that 33% of all properties are located in municipalities with less than 1,000 inhabitants and only 18% of them They are in medium or large cities, where 53% of the population resides.
The Paris-based organization focuses on the rental market is particularly “under stress” with skyrocketing demand. This behavior is even more accentuated in urban and tourist areas, despite the fact that the average rental price even exceeds the rent of many low income households. Traditionally in Spain, social housing has been intended for purchase, while the rental of these characteristics barely represents 3% of the entire park“well below the OECD and EU averages.”
The number of years of savings necessary to buy a home already exceeds 20 years and warns that “many low-income households have difficulties in meeting mortgage payments“, a factor that contributes to Spain having one of the highest rates of risk of poverty related to housing in the eurozone. In this context, its recipe to tackle the situation and converge with the European Union average involves the promotion of 1.5 million social rentals, which requires the construction or conversion of more than 850,000 additional unitsbut also for greater political stability. “Legal uncertainty as a consequence of different regulatory changes creates an unpredictable investment environment,” they point out.
