Andalusia Decrees Safeguards to Prevent Sale of Protected Housing to Vulture Funds

28 August 2018

Regulatory changes were approved to reinforce the social function of the stock of public residential housing.

The Governing Council of the Regional Executive approved a decree on Tuesday amending the Regulation of Protected Housing in Andalusia, in force since 2006, to strengthen the social character of the stock of  and shield it from private capital.

The norm, called Defence Decree for Publicly-Owned Residential Housing of the Autonomous Community of Andalusia, adapts the regulations to the current state of the real estate sector and increases the guarantees that prevent the properties from ending up in the hands of vulture funds, with the consequent damage for families with limited resources.

As a spokesman of the Andalusian Regional Executive explained in a press conference, the text expressly prohibits the sale of property owned by the public administration to legal entities, thus formalising a measure that the Junta de Andalucía already applies in practice. To date, the executive has never carried out this type of operation with profit-seeking private entities.

The approved decree, which enjoyed input from social agents through the Andalusian Housing Observatory, also incorporates measures that guarantee compliance with the housing’s social function. Among them are included further specification of the people who can use protected housing and in what situations it can be accessed, setting new mechanisms to ensure that the properties remain the habitual and permanent domicile of the chosen families.

Thus, the regulation establishes that only natural persons may be awarded residency and excludes legal entities, though not non-profits, which may be the official tenants provided that the end users belong to groups with special difficulties in accessing a home.

A response to increasing prices due to tourist accommodations

On the other hand, the text broadens the powers of administrations’ rights of first refusal and withdrawal over any protected dwelling, regarding both ownership and rent. Also, with the increase in rent as a result of the interest in tourist accommodations, added guarantees were introduced to prevent that any property is used by any party other than the authorised family.

However, the protected homes may now be used to carry out any economic activity, provided that it is the habitual and permanent residence of the person who exercises it. Likewise, swaps and transfers of protected homes owned by the same developer will not be considered as assignments. Consequently, those transfers will not be subject to the municipal registry by the claimants.

Finally, the decree also modifies the regulation of these registries, in effect since 2012, to give priority in the adjudication processes to registered people promoting housing cooperatives and not, as it has been the case to date, to plaintiffs who express their interest in forming part of them.

Original Story: Eldiá / Europa Press

Translation: Richard Turner


Regional Government of Andalucía Fines BBVA €1.62m

20 January 2015 – Inmodiario

A €60,000 fine for each one of the 27 protected homes not offered up to the municipal registry offices.

In Andalucía, banks and the Sareb are still being fined for not providing their empty subsidised homes to the municipal registry offices.

The partial suspension of the eviction law a year ago by the Constitutional Court following the presentation of the appeal by the central Government, has not impeded the processing of claims in any way, which are ending with the imposition of million-euro fines, which are all being appealed by the affected entities.

Now, it is BBVA’s turn. Its total fine amounts to €1.62m; €60,000 for each one of the 27 accredited homes that were not offered up to the respective Town Halls to be made available to citizens affected by evictions.

The apartments are located in the provinces of Granada (seven), Cádiz (six), Almería (five), Huelva (five), Málaga (two) and Sevilla (two).

According to the Ministry, these homes have not been offered up to the municipal registry offices, which establish the selection mechanisms for the foreclosure of properties under public protection and set the socio-economic requirements for access to them under the principles of equality, openness and accountability.

The fine levied on BBVA follows those levied on two other financial institutions for the same reason: Banco Popular was fined €5.82m for 87 homes and Sabadell was fined €120,000 for two homes. In addition, the Ministry is still investigating potential fines against five other financial institutions, for a total of €3.48m: Building Center (€1.56m for 26 homes), Unión de Créditos Inmobiliarios (€780,000 for 13 homes), Banco Santander (€660,000 for 11 homes), Servihabitat (€360,000 for 6 homes) and Anida Operaciones Singulares (€120,000 for 2 homes).

Furthermore, the Ministry of Development has fined Sareb (the entity known as the bad bank) €120,000 for obstructing the Government’s measures to ensure the social function of its subsidised homes. And it is investigating another case against Sareb amounting to €11.7m for the breach of article 20m, after it allegedly failed to place 98 homes at the disposal of municipal registry offices.

The law that contains the measures to ensure the social function of housing was not challenged by the central Government in its entirety but some precepts were appealed, such as the power to fine financial institutions for leaving homes empty for more than six months and the authority to temporarily expropriate the use of homes to avoid the eviction of families at risk of exclusion.

Original story: Inmodiario

Translation: Carmel Drake