Spain invests 1.3 billion euros in accelerated housing construction

The Spanish government has announced a massive program to tackle the housing crisis, allocating 1.3 billion euros to build affordable housing. The main focus will be on industrialized construction methods that will reduce construction times by up to 60%.

New construction strategy

The authorities plan to introduce an “industrial construction model” that will speed up the construction of housing complexes and improve their quality. The public-private project Perte is expected to build 15,000 homes per year over the next 10 years, with additional investment from the private sector.

Causes of the housing crisis

Rising rents and a housing shortage have become key issues for the Spanish population. The main factors include:

• Growing demand for short-term rentals (especially in tourist areas);

• Lack of free land for construction in large cities;

• An increase in the number of new households, which is outpacing the pace of construction.

According to government data, the annual need for new housing is around 300,000, while only 90,000 are currently being built.

Additional measures

To reduce pressure on the real estate market, the government is considering the following steps:

• Restrictions on the purchase of property by foreigners (including up to 100% tax for non-EU citizens who do not have a residence permit);

• Tightening regulations on short-term rentals (for example, Barcelona is planning a complete ban by 2028).

The goal is to increase housing affordability for local residents and stabilize market prices.

Economic context

In recent years, the growth in immigration has helped fill jobs and support the country's economy, but it has also put pressure on the housing sector. Spain remains one of the most popular destinations for tourists and expats, which continues to fuel demand for property.

The new construction program aims for a long-term solution to the problem through a combination of government funding, private investment and modern housing construction technologies.

Based on materials from prianproperty.com