With housing prices at sky-high levels, people in Spain say it is time for their government to take action. Governments elsewhere are taking notice.
A protest in Madrid 13 October 2024 over high rents and a shortage of long term rentals. (Credit: Leah Pattem)
Editor’s note: On 22 May, the political party of Spanish Prime Minister Pedro Sanchez introduced a bill that would impose a 100% tax on the purchase of homes in Spain by non-EU citizens. On 19 May, the Spanish government ordered short-term rental company Airbnb to remove some 65,000 listings. Both moves are meant to address the country’s severe housing crisis. Housing is in such short supply in the city that the Madrid-Barajas Airport has just announced it will restrict access to its facilities between 9 pm and 5 am to keep people from using it as a shelter. Some 400 people are believed to sleep at the airport each night.
To put these two news events into context we republish a story by correspondent Leah Pattem, first published October 2024, about how the shortage of housing affects people in Madrid and how it is part of a wide pattern of housing shortages throughout Spain and Europe. We launched Decoder Replay to help readers better understand current world events by seeing how our correspondents decoded similar events in the past.
Marjorie Kanter moved from the United States to Spain in 1985, just as the country’s democracy had begun to consolidate. She trained as a speech therapist but quickly found herself writing about day-to-day life.
“It was little things like waiting to collect money from the bank and how there were two queues: one for the farmers depositing their cash first thing in the morning, and another queue for those picking up the same notes they’d just deposited,” Kanter said.
In 1994, Kanter moved to Barrio de las Letras, Madrid’s literary district, where she found herself in the perfect neighbourhood to write poetry.
“Writing has given me self-esteem and self-confidence,” she said. “It’s opened up a world for me, it’s my soul.”
Now in her 80s, Kanter is at the peak of her career, author of three books and an active member of Madrid’s writing community. “I don’t have many more years left, so I really want to enjoy being a successful writer for as long as I can,” she said.
However, Kanter is facing a major setback. In September, a registered letter demanded she vacate her home at the end of October. A Galician vulture fund had purchased her apartment and didn’t offer her a new higher-priced rental contract. She suspects that means they will convert her home into a tourist flat.
Housing and health
At 81, being ordered to leave her home of over 30 years has severely impacted her health. Kanter did, however, find the strength to attend a protest on 13 October to call for an effective housing law. The slogan “Housing is a right, not a business” was chanted throughout.
It was one of the largest housing protests in Spain’s history.
Spain’s current housing law states that rent shouldn’t exceed 30% of the average salary. If it does, it is declared a “high-tension” area and rents are capped. These high rent-to-income — or RTI — areas affect around a third of residents across the country. But the law is ineffective in many regions, including Madrid, because regional governments have the power to opt out of it.
A high RTI in combination with over-tourism has placed Madrid residents at the bottom of the landlord’s priority list. Both real estate companies, such as the one that purchased Kanter’s rental, and individual landlords are increasingly prioritising tourist rentals over long-term tenants.
They take homes out of the residential market in search of greater profitability. A study by the Journal of Urban Economics calculated that, in Barcelona, an apartment rented through Airbnb generates the monthly income of a residential rental in just 10 days of occupancy.
Without a home it is hard to work.
Alicia Lencina is a flight attendant with a Spanish airline company. A year ago, she was offered a job in Madrid and moved to the capital from her home city of Murcia with just four days’ notice.
“Finding a flat was awful,” Lencina said. “You visit flats and then it’s [the landlords] that decide if they want you in or not. Everything was very expensive and not near the airport, which is where I needed to be.”
Eventually, Lencina found a room in a shared apartment near Madrid’s international airport for €400 per month. Her salary is between €1,700 and €2,000 per month, but for the past three months she has been unemployed.
“Over summer, I went to live back with my family in Murcia because, there, I don’t have to worry that much about money,” Lencina said. “But I’m still paying for my flat in Madrid because I thought, if I leave, it’s going to be really difficult to find a flat for this price later. But you never know how long your contract is going to be. Maybe 10 months, two months or maybe the whole year.”
Despite the precarity of her industry, Lencina has an above-average salary when she is earning, which means she can save to cover the months she doesn’t work. However, she is acutely aware that she’s the lucky one among her friends. “I can cover the basic costs, but it’s not the same for everyone, you know,” Lencina said. “For a lot of people, it’s really difficult to maintain yourself because their average salary is only around 1,300 or 1,400.”
Rents soar, earnings stagnate.
Wages have failed to keep pace with rising rents. According to Eurostat, median rents in the European Union increased by 20% between 2010 and 2022. In Spain, rent prices have risen by 26% between 2015 and 2024 according to the Organisation for Economic Co-operation and Development.
But the minimum wage in Spain is just €1,134, according to Statista. In Madrid, rent-to-income ratio is 44.3%, the highest in the country, and yet Spain’s Law on the Right to Housing is ineffective in this region.
Despite the increased demand, there has also been a lack of residential construction, which has exacerbated the shortage. One million more households exist in Spain today than a decade ago but, in the same period, only 600,000 new homes have been built. In Portugal, which has a similar issue, Prime Minister Luís Montenegro has announced a plan to build only 59,000 new homes by 2030.
Property speculation prioritises building high-revenue accommodation, leaving a shortage of much-needed low-cost housing. Average earners with a stable income are being left with no choice but to give up their jobs and seek employment elsewhere, putting at risk career opportunities.
Madrid’s housing emergency is seeing the Spanish capital shift from an economically diverse powerhouse, where people from around the world come for career advancement, to prioritising tourism over people’s right to housing as enshrined in Article 47 of the Spanish Constitution.
Balancing tourism with the needs of residents
Valeria Racu, a spokesperson for the grassroots Madrid Tenants’ Union, said that housing is the main cause of rising inequality in our society, and that this greatly impacts careers. People accept a precarious position because they need it to pay rent, Racu said.
“Even if it makes you extremely unhappy, this is the only job at the moment that allows you to pay for housing,” she said. “You end up feeling trapped because your material conditions are shaping the way you can make choices in your life, which is what happens under capitalism where we put some people’s profit above people’s rights, lives and dignity.”
Lencia is frustrated that her savings from her job as a flight attendant are absorbed by covering her rent for the months she’s out of work, and seeks to base herself in a more affordable city.
When jobs are inextricably linked to where we live, no longer being able to afford to pay rent where the job is located has an impact on careers. Kanter fears that the repercussions of her eviction from her home in Barrio de las Letras will cut her writing career short.
Barrio de las Letras is a historic Madrid neighbourhood known for its long-standing literary heritage. During Spain’s Golden Age (16th–17th century), it was home to iconic writers such as Miguel de Cervantes, Lope de Vega and Tirso de Molina. Many of the streets and squares in the neighborhood are named after them.
The area claims to preserve its legacy as a hub for writers and artists, but not for Kanter, who is currently taking time out of her work to search for a new place to live.
Questions to consider:
1. What is one reason long-term rentals are so expensive in big cities throughout Europe?
2. What do people in Madrid think the government should do to make housing more affordable?
3. Do you think vacation rentals should be banned in big cities? Why?
Leah Pattem is a British Indian multi-award-winning freelance journalist, photographer and broadcaster covering Spain’s migration crisis, housing crisis and community stories. In 2016, Leah founded Madrid No Frills, a citizen journalism project focusing on the city’s social issues and movements. Leah is a trained teacher and runs storytelling courses for all ages, levels and backgrounds. She also hosts regular free in-person events to get audiences engaged in her biggest stories.