Jon Goitia, architect and investor, has left residential rentals and now operates in temporary and tourist rentals. He says he did it three years ago because he saw an increasingly intervened market coming: “3 years ago I didn’t have a crystal ball. But I did have enough knowledge and enough experience to say that residential rentals were going to get worse and worse and worse and I removed everything,” he stated a few days ago in Public Mirror.
Her position clashes head-on with that of activist Alejandra Jacinto, who sees the new extension as a relief for tenants. The clash comes at a delicate moment: since March, contracts that expire until December 31, 2027 can request an extraordinary extension of up to two years.
The measure that changes everything
The Government estimates that the rule can protect more than one million contracts and some 2.6 million people, in a country where renting is already the home of millions of households.
The extension does not apply on its own: the tenant must request it in writing before the contract expires, and the owner is obliged to accept it unless there is family need or if a new agreement is signed.
But where does this measure come from? The international energy crisis and the rising cost of living have led the Executive to intervene in the market, while the real estate sector warns that so much legal uncertainty can withdraw certain residential rental offers.
“There is no right”
Added to all this is the automation of the real estate market: the vast majority of rental homes are in the hands of individuals, although large holders are increasingly weighing more in the most stressed areas of the country.
“What you can’t do is change the rules of the game in the middle of the game. There is no right,” Jon insists. For him, anyone who waits for the end of a five-year contract to update the rent is not speculating; it simply applies a market price when the law allows it. “That is legal. That cannot be called speculation,” he defends.
He also questions whether the State is promoting an extension while its parliamentary validation remains up in the air. “They invent whatever they want to invent and knowing that it is not going to be validated, they group the rights of 2 years into one month,” he laments.
In his vision, the rule puts everyone in the same bag: large funds, small owners and investors who have left residential rentals for fear of new restrictions.
“We professionals already left the residential sector years ago”
Alejandra Jacinto sees it just the opposite. He assures that the measure gives oxygen to “more than a million tenants” and stops “skyrocketing” increases. In his argument, what for Jon is a change of rules, for families is residential stability and time to not be away from home from one month to the next.
The point of conflict is clear: the Government wants to prevent a contract from ending in a sudden increase of 15% or 20%, while the sector fears that the effect will be just the opposite and many owners will take their apartments off the market. Jon assures that he has already left: “Professionals like me already left 3 years ago.”
“This happens when the rules change”
The rule distinguishes between small owners and large holders, but both must assume the extension if the tenant requests it. The 2% limit is maintained during that period, although in large holders it is mandatory and insurmountable.
In Madrid, where the market is especially tense, the cadastre already reflects more than 75,000 owners with at least three homes, about 10,000 with ten or more, and a small group of 517 owners with more than 50 properties each.
The big question now is whether the measure will calm the market or push more supply towards tourist and temporary rentals. Jon is clear: “This is what happens when the rules of the game change.”