The Real Estate Summit in Palma on Tuesday brought together politicians, economists, consultants and representatives of different property sectors - architects, builders, developers, estate agents.
'Housing for all' was a key theme for those gathered at the Castillo Hotel Son Vida. It was a key theme and a pressing theme that will feature high at the coming elections - highest of all perhaps. President Armengol said that "we have been the architects of a good housing law, but we must continue to make this right (to housing) possible for the middle classes and so that our children and grandchildren can live in their villages and towns".
She urged municipalities to plan their land well and to build social housing, stressing that housing for tourism purposes should "not compete with that for residents" and noting that the population of the Balearics has all but doubled over the past twenty years. This fact alone lies at the core of a debate that only too clearly exposes other facts - the creation of new homes (by whatever means) has not kept pace with population growth, while strains on housing stock have been intensified by ever-increasing prices, tourism and second home ownership.
The current mayor of Palma, José Hila of PSOE, went head to head with Jaime Martínez of the Partido Popular, his main challenger at the municipal election. Hila stated that "housing must be placed as the fifth pillar of the welfare state", an observation that Prime Minister Sánchez of PSOE made over a year ago. This might come as a surprise, as there are plenty of sources who say that housing is already one of the four pillars - or should be.
Hila said that Palma's new urban plan will allow greater height of buildings, greater allocation to VPO protected social housing and the conversion of premises into subsidised housing. Martínez argued that the plan will "paralyse building licenses even more". Tax incentives for facilitating the renting of properties were among his solutions as was the conversion of commercial premises.
Monserrat Pareja-Eastaway, professor of economics at the University of Barcelona, said that the housing emergency in Palma "is happening in the rest of Spain and Europe". It no longer affects only vulnerable groups: the problem of access to housing for all has become widespread. Given the significant increase in demand, "there is not enough supply". A solution for rent, she argued, is to build to rent, and she warned of the danger of gentrification: "We want neighbourhoods where everyone lives, not just yuppie millennials."
Judith Montoriol, an economist at Caixabank Research, spoke about home buying by foreigners. A study shows that prices rise far more in tourism municipalities than in others: 49% versus 28% increases since 2014. She added that she expects foreign buying to be lower in 2023 than it was in 2022.
Javier de Hoyo of KPMG observed that the possibility of prohibiting the sale of homes to non-residents has a "very complex" journey. In general terms, he pointed out that 25 or 30% of the price of a home consists of taxes. There is, therefore, "room for manoeuvre to lower prices through fiscal means".
It was a summit at which politicians made their pitches and experts provided their expert opinion. Francisco González, also from KPMG, made a statement with which no one could disagree: "Affordable and protected housing is lacking. That is the great challenge." Indeed it is. And just as great a challenge is the will to tackle it and, moreover, to do so through coherent long-term policies.