The new suspensions of evictions that the Government is predictably going to approve before the end of the year will mean an average impact for the owners of apartments for rent of about 9,000 euros, according to estimates prepared by the Rent Negotiating Agency (ANA).
The company has analyzed the situation of defaults that owners are facing since the beginning of the pandemic, and “the figures are alarming.” Thus, the firm has calculated the impact by taking the data on launches for non-payment of rent that the General Council of the Judiciary regularly offers and the average rental income in Spain, which is 674 euros, according to data from the Housing and Land Observatory of the Ministry of Transport, Mobility and Urban Agenda.
“This new suspension of the launches of evictions without a housing alternative, which will be approved shortly until May 9, 2021, will cause total losses of more than 9,000 euros to each landlord of housing that since the State of Alarma has already been suffering non-payment of rents “, explains ANA.
For José Ramón Zurdo, General Director of the Rental Negotiating Agency, the economic calculation is very simple and the figure can be even higher, “from the first suspension of the launches, due to the publication of the RD on March 31, until the last extension, which will foreseeably be approved before the end of the year, and will last until the end of the state of alarm scheduled for May 9, 2021, 14 months are going to pass, where many owners have not yet collected their rents, and taking the average rental price in Spain, the average delinquency would reach 9,436 euros per owner “.
“But things can still be even more dramatic,” adds Zurdo, since “when the owner finally goes to recover the home, he may find himself with damage and in some cases with non-payment of supplies, which can easily double that amount of non-payment previously mentioned “.
The average delinquency in rent will reach 132 million
On the other hand, the company has calculated the average estimate of delinquency in 2020, for launches due to not paying rent, which have not been carried out due to the prohibitions decreed.
Until the third quarter of 2019 there were a total of 27,157 launches, according to the CGPJ data, due to evictions for not paying the rent. In the same period of 2020, there have been 13,095 launches. If they are subtracted from the total figure from last year, it means that, “due to the measures adopted by the Government, in the best of cases, during the States of Alarm, 14,062 launches have been suspended until the third quarter of 2020, inclusive, by owners who have not paid their rent “, calculates ANA.
“If this figure is multiplied by the average damage caused to the owner for having been 14 months without collecting rent, calculated at 9,436 euros, it gives us an average volume of bad debts of 132,689,032 euros.” This is what, according to ANA, the owners who have initiated an eviction procedure will cease to receive, calculated from the time the State of Alarm was approved in March 2020 until May 2021, which is when it is planned For now, lift the suspension of evictions for ending the State of Alarm.
“We want to emphasize, continues José Ramon Zurdo, that we think it is very successful and necessary for the Government to want to protect vulnerable tenants and families, of course with the ICO loans they have not succeeded, finally leaving some and others helpless. We do not understand how to date, no economic consideration has been contemplated for private owners who have stopped receiving rental income, of the many tenants who have not requested an ICO in order not to get into debt or have not been granted it. Some are vulnerable owners, who are also in Ertes and are being laid off, and rent was their only source of subsistence, “Zurdo sentenced.
Temporary expropriation of the right of use
For José Ramón Zurdo, “if the Government intervenes to once again paralyze the evictions and to extend again in an obligatory way, all lease contracts that expire until the end of the State of Alarm, would be temporarily limiting the right of owners to use their homes and obtain their fruits (rental income). It is as if the owners were temporarily expropriated their right of ownership; therefore, due to this domain limitation, The Government has to compensate the landlords, as if it were a fair price, with a fair compensation that compensates for the limitation of the domain carried out, especially in the case of private landlords, who may well be living in the same vulnerable situation as tenants “.
“As we have seen”, Zurdo adds, “from the data we offer, there are thousands of owners who have not received their rents for a long, long time, and for them there is no type of aid, and they cannot wait a single month more to collect your rents “
“Since March 2019, the only thing that the Government has done, in terms of leasing, has been to legislate looking only towards the tenants, clearly favoring them to the detriment of the landlords and incidentally, destabilizing the rental market in Spain”, Aletra Zurdo.
“During the pandemic, when the rent had to be rescued, only the tenants were rescued, and half, now we hope that the measures are fair also for the landlords,” says the manager.
For Zurdo, “all these measures are assuming an important setback for legal certainty, transferring the responsibility of the Administration to the private sector, for not having known how to increase the public stock of housing for rent.”
Clear, equitable rules and legal security
Faced with the measures that this Government continues to adopt and that “affect the urban rental market in a very negative way, the Rental Negotiating Agency (ANA) requests clear, equitable rules for both parties and stable over time, which provide legal certainty to the rental market “.
Believe they are necessary norms that are the same for the entire national territory, without differences by types of owners, that protect landlords against defaults and occupation, that encourage them to rent homes. That direct aid be launched, also for the most vulnerable landlords, as they exist in other European countries.
For the General Director of the Rent Negotiating Agency (ANA), these measures that are being legislated in the matter of rentals, “do not provide any credibility or confidence to investors, both national and international, due to the legal uncertainty they produce, with the consequent and significant reduction in expected returns.
A situation that, for José Ramón Zurdo, “it will inevitably cause a displacement of these investments to other countries where there is more legal certainty, and therefore, they will stop investing in our country, which will reduce the supply of rental housing, with the consequent increase or maintenance of high prices, something that we cannot afford “.
Finally, José Ramón Zurdo, declares that, “this type of measures so permissive towards the occupation, such as the ones that have been announced to us, are intended to impose that the supplies of the occupied houses cannot be cut off, and they can lead us to the absurdity that an occupant who does not pay taxes has more rights than an owner, who, if he does not pay for electricity or gas, the utility companies can cut off his supply “.
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