Spain's prime minister, Pedro Sánchez, has announced the government's intention to build 15,000 affordable homes per year to be financed through a new fund 'España Crece' (Spain Grows) with 23,000 million euros of public and private money.
In the Balearics it is estimated that 5,000 affordable homes are needed each year in order to address the housing situation. There is scepticism, a general reaction having been one of let's wait until we see the details of the scheme. Builders, developers, estate agencies and pressure groups have all expressed their doubts.
Economist Pau A. Monserrat wonders whether the scheme will even materialise. The prime minister, he says, has "the best intentions". However, he points out that it will have to be reflected in annual budgets, and these require support in Congress. "Until we see the cranes, these announcements are meant to give the impression that something is being done when it isn't."
A familiar view comes from the president of the Proinba developers association, Óscar Carreras. "We don't have any truly viable urban or developable land to build these homes in the Balearics." But where there is land, he adds that the issue "isn't developer financing, but rather the length of the urban planning process for projects as well as the availability of affordable land.
"Developers would prefer the government to eliminate IVA (VAT), as it did with education and healthcare, or reduce it to 4% on the sale of homes under €240,000. It could do that tomorrow without needing anyone else's intervention."
The Mallorca No Es Ven (Mallorca's Not For Sale) pressure group views the announcement "with caution and scepticism". "The housing problem in Mallorca is not just a matter of overall supply, but of the model itself. Here, the market is under severe strain due to tourist pressure, the purchase of second homes, and speculative investment. Building 15,000 homes across the country doesn't guarantee that they will reach the most saturated areas, nor that they will actually be intended for the resident working population."
The details of the scheme have yet to identify precisely the type of housing. Will there, for example, be homes exclusively for social rent, or will these homes predominantly be of the VPO category? These are homes sold well below market rates at prices set by regional governments. In the Balearics these now ultimately remain under public control in perpetuity, 2018 legislation having removed the possibility of owners selling them on the open market after thirty years.
A reason for the housing problems in the Balearics is that of the more than 27,000 VPOs there once were - the first were built in 1979 - most of them have been sold. In addition, none were built between 2012 and 2021. The Partido Popular government of José Ramón Bauzá from 2011 pursued a policy of austerity, while the first PSOE-led coalition government of Francina Armengol preferred policies based on acquiring housing from owners with large portfolios to actually building.