Proposals and demands
to make possible a sufficient park of social housing for rent
The social rental housing stock must be sufficient and economically viable.
Only with decisive public intervention will it be possible to counteract the chronic deficit of very social housing and achieve a significant increase in the share of affordable social and social rental housing, which is the housing that today needs almost 50% of the population.
To achieve the necessary volumes and square the adjusted price equation for a demand with scarce resources and high construction and management costs, the promotion and management of social rental housing inevitably needs public support and subsidy.
It is necessary to act in 6 areas:
Mobilization of ground
It is necessary to have urban or urbanized land at no cost through the already operational formulas of concession or surface right by public or similar entities.
In this sense, it is essential to mobilize publicly owned land and make active urban policies (with necessary legislative changes) and a reconsideration of public investment, in order to make the quantitative (and also qualitative) leap in social housing policies. that are needed.
Subsidies to the promotion
Increasing subsidies is key to increasing the production of large-scale rental social housing.
Decisively intervening in this aspect could achieve a significant increase in the share of social rental housing (5.5 € / m2 useful – 330 € / month for a flat of 60m2 useful) and affordable social rent (7 € / m2 useful – 420 € / month for a flat of 60m2 useful), which are the homes that today need almost 50% of the population.
For the intervention to be significant, the grant would have to be doubled in the case of social rental housing and increase it by 50% in the case of affordable social rental housing.
Capture of housing
The right of appraisal and withdrawal has allowed the acquisition of 4,000 homes of financial institutions by the Generalitat, municipalities, entities and social promoters but there is still a long way to go to achieve park percentages similar to the European average: it is necessary build, rehabilitate, make changes of uses of buildings and create endowment lodgings to floors of equipment.
Subsidies to the Management
Especially in the case of very social housing of private initiative, the management and support activities are clearly deficient but also totally complementary to those carried out by public bodies.
Therefore, from a cost perspective, supporting it means saving effort for the administration. Naturally, this strategy involves recognizing the need for a stronger involvement of public budgets aimed at the third sector, which are still budgets that should also be allocated to the public sector if he were to do this task.
The existing aid of the Generalitat de Catalunya today is not sufficient and, therefore, must either be supplemented by the Generalitat itself or by the local administrations, making complementary and compatible the aid from various origins, as long as it is not exceeds the equilibrium result
Improvements in the financing
The financing of housing development or purchase operations for rent is always difficult as there are no financial institutions favorable to this type of activity.
In order to significantly increase the production volume of rental social housing, five lines should be intervened:
- Increase management subsidies.
- Provide mortgage loans on better terms, reducing or subsidizing the interest rate and, above all, extending repayment terms.
- Generate resources to provide the system with more equity, for example with debt bonds or similar.
- Generate public financing via a 2nd rank loan, complementary to the mortgage loan with a minimum interest rate (of 1% for example) with a repayment period after the mortgage, between the years 25 and 35 or 25 and 40. This system would make it possible to finance the model without involving a loss of public resources, as in addition to maintaining ownership of the land and the return of the buildings once the concession or surface right period has ended, the administration would recover the capital. invested, by which he would have obtained a return that would cover his cost.
- Increasing subsidies: this aspect would be key to significantly increase the production of large-scale rental social housing. For the intervention to be significant, the subsidy should be doubled in the case of social rental housing (up to € 700 / usable m2) and increased by 50% in the case of affordable social rental housing (up to 450 € / m2 useful).
One way to obtain financing, in a context of low or negative interest rates such as the current one, could be the issuance of Government Bonds and Obligations and, in the case of other Public Administrations, with a finalist character, directed to the creation of a great park of affordable house.
This financing for the promotion of affordable housing could be articulated through public agencies such as the Institut de Crèdit Oficial (ICO), and in the case of Catalonia through the Institut Català de Finances (ICF) under the supervision of the Ministry of Economy and the Ministry of Economy in the case of Catalonia.
Improvements in the taxation
Although the legislation has been incorporating changes in favor of the promotion of rent, it has not taken into account the figure of the direct promoters of social rental housing or the natural persons who put homes of their property at the disposal of the managing entities social.
That is why we accept the proposals made by the GHS (Association of housing development and management companies of Catalonia) to amend the legislation on Value Added Tax and Personal Income Tax :
- Modification of Law 37/1992 on Value Added Tax, which grants preferential tax treatment – super reduced rate – to the production of homes classified as officially protected for rent,
- applying this treatment to all the phases necessary for the production of these houses: acquisition of lands, provision of services and delivery of goods.
- Modification of the Law of the Value Added Tax that raises the application of the reduced rate (houses in general) or super reduced (houses of official rented protection) to the constitution and transmission of surface rights for the promotion and the operation of rental housing, for the purposes of not harming this figure (surface right and the like) with respect to the full transfer of ownership.
- Modification of the Personal Income Tax for the application of the 60% reduction in positive net rental income from housing to entities managing public housing programs.