Spain Exchanges Subsidized Housing For Rent Subsidy Program

5/12/2014 – Expansion

Goodbye, subsidized homes! Welcome, rental subsidies for unsubsidized apartments! This is the new policy of the current Government which assumes promotion of rental assistance for low-income families.

The measure has been included in the 2013-2016 State Plan on home leasing, building rehabilitaion and town regeneration and renovation. The scheme seeks replacing so-called VPOs (subsidized housing units) because currently their prices post much higher than many free and available properties across Spain.

Thus, the Government foresees granting up to 200 euros per month, until 2016, to 200.000 families that find it diffcult to make the ends meet. The Ministry of Public Works will pay betwen 33 per cent and 40 per cent of monthly rentals to households whose incomes are lower than 22.365 euros annually and who rent homes for less than 600 euros per month. Total annual payment must be inferior than 2.400 euros.

The new assistance will be provided for 12 months, extendable until the end of the Plan’s effectiveness. However, as the approval arrived a bit late, the applicants will have a chance to enjoy the support until 2017.

Not in vain, the Ministry has already foreseen 48.000 beneficiaries of the assistance in 2014. Will it be done just in four weeks? The eligible people in need cannot earn more than three-times the Iprem (Spanish Public Indicator of Multiple Effect Income) but the quota may vary in accordance to the number of family members. Moreover, priority will be given to the evicted.

On the other hand, from the real estate market news, recent report by Tinsa states that the industry predicts decrease in yields on prime assets, as well as a cut in incentives for office rentals. Also, it says interest will boost about vacant or for management assets.

 

Original story: Expansión (by Juanma Lamet)

Translation: AURA REE

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