Why will 80% of homes not be able to be sold or rented from 2030?

Why will 80% of homes not be able to be sold or rented from 2030?

The housing stock in Spain is very old. The average age of the used housing stock is 43.5 years, according to data from the National Federation of Real Estate Associations (FAI), which means that millions of homes have a large deficit in accessibility, comfort and energy efficiency. In fact, 90% of households They are over 18 years old and this figure increases year after year due to the slowdown in the construction of new homes. According to Andimac, the association that represents the professional distribution of materials for building and rehabilitation, 83% do not meet the minimum energy efficiency requirements that Europe has imposed to be able to sell or rent a home from 2030. A European directive approved during the Spanish presidency (which must be transposed within a period of two years) requires that in that year the homes have at least the energy rating E to be able to rent or sell and three years later the letter D will be required. Currently eight of every ten homes have a rating of F or G, according to Andimac.

This means that in the coming years, hundreds of thousands of homes will have to undertake rehabilitation and renovation works to improve their energy efficiency. Or they cannot be rented or sold. And not only to comply with European regulations. The latest Living Conditions Survey published by the National Institute of Statistics (INE) shows that one in five homes cannot maintain an adequate temperature. It is the highest figure since 2004, the year in which the series began to be developed. In just four years, due to inflationary tensions, the number of homes without decent heating has gone from 7.6% in 2019 to 20.7% in 2023.

But rehabilitation is not going at the desired pace. The visas granted last year – according to data from the technical architects published by the ministry – do not even reach half of the objective that Housing had set: 22,000 visas in 2023 (estimate, until November they were 20,511) compared to a target of 40,000 and 8.5% lower than the previous year. In the last three years, since the Government committed to a path of housing rehabilitation with the European Commission, the reality has been far from what was planned: almost half of what was set by Housing and much less than a third of what it aimed for. the Ministry for the Ecological Transition.

The reason? The collapse in the management of European funds for rehabilitation. According to the general secretary of Andimac, Sebastián Molinero, “there is absolute paralysis” with tens of thousands of rehabilitation projects linked to Next Generation funds that the autonomous communities still have in the study phase and have not been unlocked. We are talking about applications that were submitted in 2022 and that are not yet approved. “To meet the objectives, aid will be needed,” says Molinero, who emphasizes that the money to rehabilitate homes is “an investment because it prevents citizens’ assets from losing value.”

The total housing stock exceeds 26.8 million. The objective committed to Europe is that more than seven million homes will be rehabilitated by 2050, that within four years they will be rehabilitating 200,000 homes annually (which would mean multiplying the current level almost tenfold) and that in 2030 a rate of 300,000 will be reached. homes rehabilitated per year.

Eight million homes will be between 65 and 90 years old in the next decade; they are those that were built between 1940 and 1970, especially during the era of Spanish developmentalism. And buildings are like the human body: they age. Metal, concrete, etc. do not remain unchanged. The reform employers warn: “Aging can cause problems in the next decade and the obsolescence of buildings will erode household savings.” In Spain, Molinero laments, there is no preventive culture of rehabilitation.

There has never been so much public money to improve housing nor so much demand, pending all European funds being channeled and executed. Meanwhile, if you are going to buy a house, look carefully at the letter of the energy certificate. Because jumping from a G to a D entails no small investment, which can range from changing the windows, installing another boiler or rehabilitating the façade. You can also request, in addition to the Building Evaluation Report (formerly known as ITE), the Building Book, which includes the roadmap of what actions should be carried out. Many owners of buildings with a certain age are afraid of hearing the cursed word at every neighborhood meeting: spill.

And then, apart from the possible spills, there are the renovations that each person makes in their home. 60% of homes carry out some type of renovation and although the average is 869 euros in the last year, when the bathroom and kitchen are changed the budget goes to 20,000 euros.

Gap between houses and homes

Currently, in Spain, less than half of the homes are built per year in relation to the homes that are created. The balance has been negative for more than a decade, when after the real estate boom that led to 200,000 more homes being built than necessary in 2008, the crisis hit the sector and housing development collapsed. Now between 100,000 and 150,000 fewer homes are built per year than homes are created, so there is a deficit of new housing that not only makes prices more expensive as there is little supply but also does not allow the housing stock to be rejuvenated.

This phenomenon of shortage of new housing supply is observed in a large part of the real estate markets of advanced economies, especially due to the recent demographic momentum observed in these countries, especially in large cities. According to the Caixabank Research real estate report, the shortage of new housing supply in Spain, the Netherlands, Ireland, Denmark, Germany and Austria stands out. On the contrary, they have more than enough supply to satisfy demand in the United States, Canada, Australia, Luxembourg or Italy.

«Aging can cause problems in the next decade and the obsolescence of buildings will erode household savings»

Sebastian Molinero

General Secretary of Andimac

Who buys a home in Spain? Basically, the one who can. The rising price of apartments prevents even workers with decent salaries and of a certain level from being able to acquire a home, depending on the areas. The Government has launched a line of ICO guarantees for 20% of the mortgage so that banks can grant a loan for 100% of the value of the property and facilitate the purchase, especially for young people, whose age of emancipation is one of the highest in Europe due to the difficulties in having their own home, whether rented or rented. property.

The average age of people who buy a home in Spain is 41.4 years. In the areas with the greatest demand, housing is so expensive that transactions occur mainly between those who already have one and sell it to buy another: 61% of buyers do so to change homes, 17% change the rent by purchase and 21% buy to emancipate themselves, according to a study carried out by the Federation of Real Estate Associations (FAI).

Who buys the homes

For its part, the most frequent profile of people who sold homes through real estate agencies was that of people between 50 and 60 years old (44.7%), followed by those between 40 and 50 years old (31.1 %). Among the main reasons for selling, 35.1% did so to change their primary residence, 30.8% to settle an inheritance and 15.3% due to a divorce or separation.

Who sells the homes

Last year, home sales fell by 10% and, even so, 586,913 transactions were carried out, the second highest number since the 2008 crisis, and more than a third were paid in cash. Given the shortage of new housing, 81% were purchases of second-hand properties. “We need measures that favor effective development and management of land to produce more housing, especially at an affordable price, in addition to a stable regulatory framework that encourages public-private collaboration,” says Beatriz Toribio, general secretary of the Association of Developers and Builders of Spain.

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