The population growth contributed by immigration is, together with the favorable competitive positioning of our productive fabric, one of the main propellers of the Spanish economy, contributing to explain the growth differential with European partners. This impulse, however, is only sustainable if a housing construction cycle is initiated that can stop the housing crisis that lills citizen perception and threatens to constrain future growth. Fortunately, the market begins to leave the paralysis generated by the explosion of the real estate bubble of almost two decades ago. They are just a handful of indicators, but all point in the same direction of a recovery – if still insufficient to overcome the shortage situation. In the last two years, the number of new construction visas, an advanced indicator of the offer since it is a process prior to construction, has increased by 10% (total accumulated between the first quarter of 2023 and the first quarter of this year). The volume of housing initiated, that is, the next link in the offer chain after the visas, also rebounds to rates that exceed double digit. And the finished homes, which are those that directly influence social perception, evolve favorably. Similarly, the credit stock for real estate activities began to register interannual rates of positive growth in the third quarter of 2024. They are the first increases registered after 15 years of uninterrupted falls, which placed the volume of the credit in early 2024 in just 20% of the maximum reached at the beginning of 2009. That is, the new credit flows begin to overcome the matches. The construction to the construction registered a null variation in the closing of the last year, which, after a very long period of intense falls, also points to the beginning of a change in trend. However, the housing supply grows at a higher rate than the demand that emanates from the formation of new homes. It is premature, however, interpret recent trends as precursor signals of a structural improvement in the real estate market. First, the accumulated deficit remains considerable, since 1.3 million homes have been incorporated in the last decade, in front of less than one million homes initiated. Therefore, the increase in supply is not significant in relation to the size of the deficit. To the current rhythm, even under the assumption of a moderation of immigrant entry, housing access difficulties, particularly for young people, would last for at least one decade. In addition, the construction is concentrated in the free market, involving unassumable prices for most families. The consequence is that the demand moves towards the rental segment, whose increase even exceeds the one that supports the real estate purchase. If the construction of affordable housing is not relaunched, the percentage of the available income allocated to the payment of the rent in the most tensioning areas can only grow, braking mobility and limiting the expansive cycle itself. The strategic plan, or belong, of industrialization of housing addresses this challenge from the point of view of public investment and the acceleration of the construction process. But the Gordian knot is in the obstacles to the granting of land to build affordable housing: the strong demand is an incentive for private investment, while the shortage of buildable soil and the normative oddities frustrate those same incentives. The fact of providing new public resources does not change this reality, unless it is accompanied by the necessary normative changes to unblock the market. If this is a collateral effect of the plan, welcome. Continue reading
