Speculation Bans and Rent Caps Won’t Fix Barcelona’s Housing Crisis, Expert Warns
A leading academic argues that focusing on anything other than boosting housing supply is a distraction from the city's core problem.
As the Catalan government mulls a ban on speculative home buying, a leading housing expert warns such proposals are merely “urgency measures” that fail to tackle the fundamental driver of Barcelona’s housing crisis: a chronic lack of supply.
Ramon Bastida, who directs the Chair for Decent and Sustainable Housing at Pompeu Fabra University (UPF), argues that the only viable long-term fix is to build more homes, a process currently hobbled by bureaucracy. “The main solution is to increase supply, which would help us balance the situation,” Bastida said. “The problem is that housing supply isn’t like a car; you can’t manufacture a unit in a day.”
The proposal to prohibit speculative purchases, a policy tested in Dutch cities like Rotterdam and Amsterdam, is unlikely to lower prices, according to Bastida. While the measure successfully deters investment funds by forcing them to hold properties for years, it does not address the underlying demand from residents, further complicating the landscape for local buyers who must still compete for scarce inventory. “When you tell an investment fund that if it buys the apartment, it will have to wait four or five years, it’s no longer interested,” he explained. “But this doesn’t make prices fall because the demand is still there.”
“If there is more demand than supply, prices will continue to rise,” Bastida stated, adding that “the measure by itself only removes some speculative players from the market.”
Rent Control’s Unintended Consequences
Existing rent caps in Catalonia have shown mixed results. Official data from the Generalitat and Barcelona’s City Council point to a price reduction between 4% and 6% for new contracts, with some analyses suggesting a drop as high as 9%. “Possibly, new tenants who have moved in have done so at a lower price,” Bastida acknowledged.
However, he highlighted a significant side effect that has undermined the policy’s goals. “A portion of the rental supply has shifted to temporary rentals and has continued to be rented at high prices,” he said. This persistent affordability crunch means many residents are spending far more than the 30% to 40% of income on housing that Bastida considers a benchmark for sustainability. “In certain cities, especially in urban areas, incomes exceed this 30% or 40%,” he noted. “Notably, certain groups, like young people and increasingly middle-income families, not low-income, are exceeding these percentages.”
Red Tape and Aging Buildings Compound Problem
The path to increasing supply is notoriously slow, with developers citing a “maturation cycle” of eight to ten years from land acquisition to final delivery of a building. Bastida supports industry calls to streamline the permitting process. “One of the things developers and builders mention is the need for a single window to avoid having to go to the city council for one license, another to a department…”
Compounding the shortage is the age of Barcelona’s housing stock, where the average building is over 50 years old and suffers from poor energy efficiency. Upgrading these properties to modern standards is a formidable challenge. “It is almost impossible to rehabilitate a home to have the same standards as one built today,” Bastida said, explaining that core structural elements cannot be easily modified. “You can change walls, closures, ventilation… But today, materials are used that better insulate the building’s structure from the start.” Without demolishing the building, he concluded, “it is very difficult to apply these solutions.”
For more information on housing regulations in Spain, see the government’s Law for the Right to Housing.
