In recent years, the Catalan community has enthusiastically applied a Intervention policy in the rental market. The result, far from relieving pressure on tenants, has been a alarming setback in the housing offer available. According to the rental observatory, Since 2019 the number of rent for rent has fallen 42%passing from 199,050 to just 114,878 in 2024. But the worst is yet to come: the forecast for the end of the year is 100,697 homes, which would mean the 58% destruction of the offer in just six years.
The case of Barcelona It is even more blunt. Of the 170,764 homes offered in 2019, it is expected that only 83,117 are expected in 2025. Half of the market has disappeared. And not because tenants do not want them, but because many owners are no longer willing to rent them. At that price, simply does not compensate.
Source: Carlos Arenas Laorga
This phenomenon has its economic logic. As Henry Hazlitt already explained, set a maximum price (below the market equilibrium level) generates an unavoidable consequence: shortage. In a free market, the interaction between supply and demand determines the price. But if an artificially low price is imposed, the demand shoots – all the world wants to rent cheap – while the offer contracts – no wants to rent below its costs or risk of losing profitability.
This is not a book hypothesis. In Barcelona, the Number of interested parties for each floor that is published is 341 people in the first ten days of the ad. The national average is already high, with 122 interested in housing, but Barcelona exceeds all reasonable thresholds. The rental observatory considers that a normal pressure would be below 15 contacts. We are, therefore, in a situation of authentic real estate hysteria.
And what happened to those floors that have left the market? Some have gone to temporary rental, others have sold and many, ”they are – they are simply empty. The Barcelona City Council estimated in 2018 that only 1.2% of the homes were unemployed. However, the most recent INE data, which are based on real electricity consumption, suggest that more than 9% of the city’s floors are empty. Not that there are no homes: they are outside the conventional rental circuit. A direct consequence of badly calibrated interventionism.
With these policies, we should not surprise us that prices continue to rise. The average rental price in Spain has reached 1,146 euros per month, with an increase of 7.2% year -on -year. In Barcelona, despite the intervention, the rent has risen 5.5%, and is already at 1,649 euros on average, returning to the first position of the national ranking, even ahead of the Balearic Islands. Other provinces such as Madrid, Guipúzcoa or Vizcaya also exceed the 1,000 euros per month.
Source: Carlos Arenas Laorga
The paradox is evident: Try to protect the tenant with maximum prices, and the opposite effect is achieved. The supply collapses, the demand is concentrated, the real prices rise (because there is not enough offer), and parallel markets that escape regulation are generated. It is not difficult to imagine what happens when a good is scarce and there are many people willing to pay more for it: the shortcuts, the legal spikes, the finger reserves, the temporal contracts that are renewed “with small print” or the payments in B. that is, the black market of the rent.
We have seen all this before. Rome, postwar Spain, Germany prior to Wirtschafttswunder … when Ludwig Erhard eliminated all the maximum prices of the German economy in a single decree, the effect was immediate: suddenly, the markets were filled with previously missing goods. Bread, milk, meat … everything had been there, only hidden because it could not be legally sold at profitable prices. Exactly what is happening today with the rent in Barcelona.
The intention of price control policies can be well intentional, but The result is usually the opposite of the expected. And this happens ALWAYS. Those who apply them are ignorant, in the best case, or evil, at the worst. If you want to increase access to housing, the road is not to punish the owners or discourage the offer. It is to generate more offer: to facilitate construction, encourage investment in rent, offer legal certainty and open the way to public-private collaborations that really have an impact.
As long as the symptom is continued with the disease, we will continue to prescribe medications that, far from healing, make the diagnosis worsen.