In Barcelona, Spain, many families are not able to pay the rent nor buy a house. The 2008 economic crisis came in Spain with the bursting of a real estate bubble and a restructuring plan of the banking system. With the help of the government, investment funds have used the crisis to enter the Spanish housing market and hoard properties. The result has been a 55% increase in rental prices, 1,7 million people evicted from their homes and 73% empty houses in hands of corporations. Social organizations in Spain have mobilized fiercely to introduce measures to ensure the right to housing. This has led to the creation of a Housing Law, which aims to promote social housing, regulate the rental market and provide security measures against evictions.
Text: Clara Roig
Photographs: Bruna Casas / RUIDO Photo
Irene, Juanjo or Ana María are some of the many people in Spain who lost their homes after the 2008 economic crisis. In Spain, the crisis had also precipitated the bursting of a real estate bubble, which had been promoted by easy credit at low interests by the banking system. Approximately, 60% of the credit granted by the Spanish banks was in the real estate sector. While in 2008 many construction and real estate companies went bankrupt, many families stopped being able to pay the mortgage. For 12 consecutive years (2008-2019), 156 evictions were carried out per day, amounting to 684,285 evictions and more than 1.7M people forced out of their homes, including children. Catalonia, the Autonomous Region to which Barcelona belongs, is where this phenomenon has been more excruciating, comprising 19% of the Spain’s’ evictions.
Right after the 2008 crisis, Irene and her husband stopped being able to pay the mortgage of the apartment they had bought in 2000 in the outskirts of Barcelona. In 2011, the couple, who had four kids, lost the ownership of the house. The bank responsible for their mortgage, Caixa Tarragona, merged with another bank and sold the house in action for half of the price Irene had paid for. In 2018, the property went to the hands of the real estate company Fincas BCN, and Irene and her husband were left with a debt of 10,000€. Due to this debt, Irene’s husband lost the Spanish residency and they were not able to access social housing. Even though they were in a vulnerable situation and had gone to court with the help of a neighbors’ organization, in March 2022, eight police vans came to Irene’s door to evict her and her family.
“They have evicted me from my home, where I have all my memories”.
Irene’s story is not an isolated case, but an example of the collective repercussions of the financially oriented solution to the 2008 economic crisis. In short, governments gave more power to the banking systems, thus promoting the financialization of housing. Observatori DESC relates the consolidation of evictions with a series of laws that the Spanish government both from the left (PSOE) and the right (PP) approved from 2009 to 2013. These include laws that helped accelerate the judicial process of evictions (Law 19/2009; Law 37/2011), with some exceptions to vulnerable families. In 2013, PP approved a law to make the housing market more flexible, decreased the number of compulsory years for a rental contract from 5 to 3 and decoupled the Consumer Index Price (IPC) from the rent prices so they could increase above the consumer price. These laws came at the same time as a tax reform that allowed real estate companies to evade corporate income taxes. The aim of the reform was to encourage foreign capital to acquire the real estate stock with a high risk of default in hands of the wrecked Spanish banking system as well as of Sareb, a public-private society created to deal with assets coming from the restructuring of the banking system.
Between 2012-2013, investment funds such as Cerberus, Blackstone and Goldman Sachs acquired enough real estate assets to influence the housing market and create another bubble, this time, in the rental market. Since 2015, rent prices increased much more than housing prices, according to a study by the Bank of Spain. In big cities such as Barcelona and Madrid, as well as other touristic areas, rent prices increased up to 55% from 2013 to 2019. By 2018, the Spanish banking system had 3,5 million empty houses in their stock while there were 100 evictions per day for not being able to pay the rent.
In 2013, Juanjo’s mortgage in Ciutat Meridiana, in the outskirts of Barcelona, was suddenly raised 800€. Two years before Juanjo had lost his job as a distributor for an industrial food company and was riding out the crisis with temporary contracts and some loans from friends. He managed to get a rent in social housing until 2021, when his mortgage ended up in the hands of Divarian, a real estate society created in 2017 between Cerberus and BBVA to transfer the risky housing assets from the bank to the investment fund, including Juanjo’s mortgage. Now Juanjo continues to pay his rent despite the notice from Divarian that he must leave his place. He has tried to find other apartments for rent but has not found anything he can afford. He has spent 53 years in Ciutat Meridiana and does not want to leave the neighborhood.
“Before families lived here, they were my neighbors. Now you only see an iron door and alarm to avoid squats. What do they want to do here? We only want to live peacefully. I won’t leave even if they pay me a fortune!”
In Spain, and more concretely in the big and touristy cities, families cannot afford to buy a house nor pay the rent. In Barcelona, 42,7% of the population spends more than half of their salary on housing. While 20% of workers earned equal or less than the minimum wage in 2020 (935€/month), a 70m2 flat in Barcelona could cost on average 1050€.
In the meantime, empty houses remain in the hands of investment funds, the Spanish banking system and big landlords, thus promoting the financialization of urban housing and the gentrification of entire neighborhoods. In 2022, Blackstone had 5,550 properties in Catalonia through a network of 8 partner companies. 73% of the properties owned by corporations are empty. The only option for some is to occupy these empty houses, but they are also being evicted.
This is why initiatives like Bloc Ruth, a squat house that provides shelter for more than 15 people, have emerged in Catalonia. The block of apartments is located in Gràcia, a trendy neighborhood of Barcelona, and was created by the Union of Housing of Gràcia (Sindicat de l’Habitatge de Gràcia in catalan) to offer housing for vulnerable families. The apartment building is property of Cerberus, an international investment fund. The building has five floors and in each floor lives one family. The families and the youth from the Union of Housing organize assemblies to manage the building and make sure the families meet their needs.
In Spain families cannot afford to buy a house nor pay the rent. In Barcelona, 42,7% of the population spends more than half of their salary on housing. Meanwhile, 73% of the houses in the hands of corporations remain empty.
Ana María is one of the residents of Bloc Ruth. She lives there with her three kids. Her story is one of many, jumping from house to house as prices were skyrocketing. In 2008 she had a mortgage, but with the crisis she lost the property of the house. She then started to pay a rent, but soon was unable to afford it. She joined another squatting house, also in Gràcia, where she lived for six years until she was evicted. Now, she hopes that with the neighbors’ pressure Block Ruth will be converted in social housing and she will be able to stay.
In Spain, housing has become an investment asset instead of a right for everyone. The market has not regulated itself, rather, has led to more speculation. However, after intense social mobilizations by newly formed groups advocating for the right to housing such as Sindicat de Llogaters (Union of Tenants) or PAH (Platform of People Affected by Mortgages), the governments have started to implement some measures to regulate the housing market. The first initiative came in 2020 from the Catalonian government, who pushed by 4.000 social organizations, passed a law to limit rent prices in areas of market speculation. The aim of the law was to ensure that no one has to spend more than 30% of their salary on housing.
In Spain, housing has become an investment asset instead of a right for everyone. The market has not regulated itself, rather, has led to more speculation.
However, the law was halted by the Spanish Supreme Court after one year and a half of successful implementation alleging that the Catalan government had no competences in market regulation. Catalan families had to wait until May 2024, when the Spanish leftist government led by Pedro Sánchez approved the Housing Law (Ley de la Vivienda) to ensure that every citizen has the right to a dignify house. It aims to promote more social housing in a country with only 2.7% of housing stock (compared to the European average at 15%), as well as to limit the rental market, and provide security measures against evictions. Nonetheless, in a world of increasing financialization of the commons, its real impact is still yet to be seen.
After intense social mobilizations, in 2020 the Catalan government passed the first law to regulate the housing market. Finally, in May 2024, the Spanish government also introduced a new law to ensure the right to housing.
