Faced with one housing crisis that mainly affect young people are Portugal And Spain, whose governments are promoting measures to increase social housing and make real estate available at much more affordable prices. high rental pricesborrowing costs mortgage loans but exorbitant prices for real estate they are a problem not only for Spain and Portugal, but for the whole of Europe, as the cost of housing is burdensome compared to income in many countries. Social housing accounts for roughly 2% of the housing stock in Portugal and 1-3% of all housing in Spain, according to estimates in a related Financial Times publication, lower than the European average of 7.5%. The difference is even more noticeable if we compare the above percentages with those in France (14.5%) and the UK (17%).

The figures, also according to the British newspaper, show that public housing has been only a sporadic political priority in the Iberian Peninsula since its dictatorships collapsed in the 1970s.

In this context, Madrid is exploring the possibility of using a troubled bank resulting from the last financial crisis to create up to 50,000 social housing units, while Portugal is looking for solutions to cope with ever-increasing housing prices. Spain’s cabinet is about to approve a plan to increase the national fund of 290,000 social housing units by 17% with properties from its failing bank set up in 2012, according to a British newspaper. The bank was created to clean up the toxic assets of lenders after the housing bubble that burst four years ago.

For his part, the Prime Minister of Spain Pedro Sanchez he said the move would solve “a huge and real problem” by making more homes affordable at fair prices, especially for young people. “Housing in Spain is a constitutional right, but not a real right. Young people have to wait unacceptably long to access housing and become independent,” he said. The seriousness of the problem was highlighted on Monday by new data from real estate company Fotocasa, which showed that rental prices in Spain hit a new record high in March, up nearly 10% year-over-year to €11.55 a month per square metre. .

Madrid is considering using the troubled Sareb Bank to build up to 50,000 houses.

Meanwhile, aggressive rate hikes by the European Central Bank over the past year have pushed the cost of borrowing for mortgage holders to the highest level in a decade.

The Portuguese government last year approved investment plans worth 2.4 billion euros aimed at developing public housing by the end of 2026. At the same time, it submitted a housing bill to parliament last Friday that would allow the state to convert vacant private property into social housing. “This problem is facing all of Europe, so we need to find new answers,” Marina Gonçalves, the minister in charge of social housing, told the Financial Times. In recent years, municipalities and regions have not had much room for additional spending due to the fiscal costs of the financial crisis, which in 2008 was rooted in a real estate bubble.

As such, the socialist-led governments of the two countries have recently been promoting broader reforms to make private property markets fairer while recognizing the vital importance of social housing.

Spain plans to sell 21,000 vacant properties from its “bad bank” known as Sareb to regional and municipal authorities so they can turn them into social housing. The final part of her plan is to set aside vacant land owned by a government-controlled bad bank to build 15,000 new social housing units.