From 1 January 2007, the Spanish government will pay a subsidy of €210/month to people aged 22-30. This payment is to help them get out of the family home and into their own flats and will be paid for 4 years. Low interest loans of up to €600 will also be available for those who need to pay a deposit or bond on their chosen property.
At first glance, this seems a laudable move: rental prices are very high in many parts of Spain, especially Madrid, Barcelona, and any coastal areas. Salaries are relatively low: about €18kpa for man and about €14kpa for women (note the disparity), so it’s a shocker for most to have to pay rent in the inflated housing market that is Spain. It’s not surprising, then, that only 42% of Spaniards aged 18-34 have left their parents home. In theory, at least, this state aid will help up that figure and get those kids out the family nest.
But why are housing prices so high? According to the Universidad Politecnica de Madrid, there are 3.01 million empty properties and 3.36 million ’second homes’ in this country. The hallowed law of supply and demand says that prices should adjust up or downward to meet demand. If supply is plentiful, as in this case it is, then prices should reflect that, in this case, drop.
Instead, this subsidy pays into the pockets of landlords, helping renters but consequently keeping prices high. This feeds into the cycle of speculative property buying and real estate investment that are rapidly consuming this Spanish countryside and coastline. If a landlord can turn a profit on his/her rented flat, they are more likely to build their investment by later buying new properties. And so, they keep building.
Sustainability works on the principle of win-win. In this case, it’s not that real estate investors have to ‘lose’ in order for ecological concerns to ‘win’. We need to find a balance between the two. I guess that the investor needs to turn a profit but not get greedy and the ecologist has to accept a certain amount of encroachment by humans into green space.
I personally support this idea of high-density housing with well-maintained public space and the rehabilitation of existing housing stock. Housing estates fail because they ghettoize poor people. High-density housing is not public housing: rather, it is well-planned and well-maintained mixed community housing that makes good use of light, air and public space in order to enhance the lives of its residents. In other words, not everyone needs a back garden if they can use a shared garden and chat to their neighbours at the same time. And as for older buildings being remodeled into modern dwellings: it’s good for the environment because they can be insulated and improved and it’s good for cities and towns because older buildings are often in the centre and this thus reverses the donut effect of workers moving out. Old industrial areas such as the London Docklands or Amsterdam’s Zeeburg can be redeveloped to create housing sotck where once were warehouses.
