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Forcing Large Landlords to Rent Empty Apartments in Barcelona, Spain


Barcelona demands that large companies sitting on empty apartments rent them within one month or face a forced sale to the government at 50 percent of market value.


Barcelona has faced an escalating affordable housing crisis over the last 10 years and has led the pack when it comes to implementing policy to curb predatory real estate behavior. Notably, the city built out a team of 40 inspectors to implement fines of up to €60,000 to owners operating a vacation rental without a license—of which they estimate there are around 7,000 unlicensed units.


Faced with a deepening economic crisis from COVID-19, in July 2020 the Barcelona City Council announced a new administrative rule that mandates several large landlords to rent vacant rental units in one month’s time or be faced with a forced sale to the government. These units would then be added to Barcelona’s public housing supply and the owner would only be offered 50 percent of the unit’s market value.


Aside from the need for more rental units, there is an increased concern of crime in unoccupied units around Catalonia with many being squatted on by drug dealers. By forcing occupancy, these buildings will become safer for everyone in the neighborhood.


Bloomberg CityLab reported the criteria for forced sale to the government: the property must have no tenant contract history for two years and no record of recent power or utilities use. This likely excludes second homes or vacation rentals, though those are monitored under other progressive housing policies.


Barcelona’s Housing Commissioner Lucia Martín told 20 Minutos, “We are not here to expropriate. What we want is for apartments to be rented.” This demonstrates a thoughtful approach by the city government to consider where they can apply the most pressure—by first going after large real estate portfolios—to signal to smaller landlords that they are serious about getting apartments occupied and off the shadow market.


 

Highlights:

  • Barcelona’s City Council is forcing large landlords to rent vacant apartments within 30 days or face a forced sale at 50 percent of market value.

  • Initially, 14 large landlords were contacted with the new administrative rule targeting around 200 empty apartments in their portfolio.

  • The city already has hefty fines for illegal vacation rentals—of which they estimate there are around 7,000 unlicensed units.


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