Catalonia, the only CCAA to apply the rental reference index, is confused about its application

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Catalonia is the only autonomous community in Spain that, for fifteen days, has been applying the state index intended to limit the rental price in an environment dominated by doubts about its effectiveness and the interpretation of concepts as fundamental as that of the large landowner. These are some of the main questions.

Are all rental apartments subject to the new index?

APIs (real estate agents) are expressing concern about the gaps they are seeing among renters, many of whom believe the index should be applied to all homes.

The measure provided for in the government’s housing law applies in areas where the market is tight in two broad areas: in the rental of apartments owned by a legal or natural person that has five or more properties – considered large owners – and in the rental of apartments has come onto the market for the first time in the last 5 years (including small owners).

What do you mean by a big fork?

The various agents in the real estate market today have expressed doubts as to whether it is necessary to own a property 100% in order to be considered a homeowner. The APIs defend that in cases of shared ownership – which is very common when it is the result of inheritance – only the percentage share is calculated.

The Generalitat claims the opposite. “Someone owns a house whether they own 50% or 25%,” Department of Territory sources say. If interpreted differently, we would be faced with an attempt to circumvent the law and therefore commit fraud, they point out.

According to API, if a person is a co-owner of an apartment, not the entire property should be attributed, but only the share in which he or she is the owner.

In the case of co-ownership, in order to achieve the calculation of 1,500 square meters of residential use, the calculation must be made taking into account the aliquot parts, including all land for which a participation fee is charged, this document states.

How can we know if a rental property belongs to a large landowner?

There is no register of large farmers in Catalonia. The Generalitat has started preparing for such an election, but is pessimistic that it will see the light of day this term, as regional elections will take place on May 12.

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Currently the only way to find out if it is a major owner is to contact the Land Registry directly, which means you have to pay for this information.

Is the index applied throughout Catalonia?

No, the index should only be taken into account in the 140 municipalities declared by the Generalitat as polluted market areas. 80% of the Catalan population lives in these 140 municipalities.

These are municipalities in the greater Barcelona area and the provincial or regional capitals, where 6.2 million people live.

These communities have been declared crisis areas because they meet requirements such as rent accounting for more than 30% of family income. In Barcelona, ​​for example, it is over 50%.

In principle, small owners must base their prices on the previous contract.

How much will the rent reduction be?

That is one of the big questions. While waiting for the index to be applied and enough data to be generated to draw conclusions, the APIs predict an average drop in income of 20%, although with a wide spread that could be between 4% and 40%.

The Generalitat, which is very critical of the index created by the government because it has defended another index that, in its opinion, would have been more effective, assures that 36% of the houses in which it is applied will reduce the rent and that Rents will fall on average by 3.5%.

How is it controlled that the rent adjusts to the index?

This is another one of the unanswered questions. The housing construction law on which the index is based does not provide for any sanctions regulations. The standard points out the obligation to report the reference price and the previous contract, but does not go further.

The Generalitat, which has all powers in housing construction, has not yet made it clear how the application of the index will be controlled.

Sources from the Department of Territory have assured that they are examining whether the Consumer Law can be used to punish violators, reminding that tenants can go to the court to directly report any irregularities.

How many houses are big forks?

The Generalitat assures that 12% of houses in Catalonia are owned by large owners. According to his calculations, only 40% of apartments in Barcelona should have their rent reduced.

According to the Observatori Metropolità de l’Habitatge de Barcelona, ​​84% of owners in the Catalan capital own a single-family home, accounting for 55.5% of the total number of houses. In 2023 there were 524,357 owners and 794,272 apartments.

For their part, owners of 5 or more houses make up 2.2% of the owners (11,777) and hold 23.2% of the inventory (184,111), which corresponds to an average of 15.6 houses per owner.

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