How Much Longer Will We Look the Other Way? The Public Administration and the Social Housing Time Bomb

The housing crisis in Spain is no longer just a concern. It’s an emergency. And the most alarming part isn’t that we’ve reached this point, but that those with the power to act remain frozen—trapped by ideology, bureaucracy, lack of political will, and, let’s be honest, incompetence and short-sightedness.

Where is the government when it’s most needed? The warnings are clear and unanimous: developers, banks, real estate platforms, analysts, and even the financial sector have been sounding the alarm for years. The lack of available land, the heavy burden of taxes and fees, and the impossibility of building affordable housing are pushing the country toward a social explosion in just a few years. Yet Prime Minister Pedro Sánchez and his coalition remain entangled in empty promises, vague future plans, and superficial measures that arrive too late and often make things worse wherever they are applied.

A Legislative Bottleneck Created by the Administration Itself

The current situation has clear and direct culprits. The housing market is trapped in a web of poorly designed laws, ideologically driven regulations, and legislative deadlocks that prevent housing supply from growing at the pace society needs. While 200,000 to 300,000 new households are formed each year, only about 97,000 new homes are completed. The imbalance is unsustainable.

To make matters worse, much of this new housing stock is located along the coast and intended as second homes or tourist rentals. The scale of the problem is massive—and everyone seems to be looking the other way.

Meanwhile, the government boasts about strategic projects (PERTEs), EU funds, and theoretical initiatives that fail to change the actual situation. The much-hyped PERTE for industrialized construction promises just 15,000 homes per year over ten years. Do they really believe that will solve the structural deficit of 700,000 homes built up over the past five years?

The Housing Law: Ideology Versus Common Sense

The so-called “Housing Law,” promoted as a political flagship by the government, has been flatly rejected by many autonomous communities and has sown more legal uncertainty than real solutions. Rather than encouraging the construction of affordable housing, it has discouraged private investment and triggered a chilling effect among developers—many now prefer not to build at all rather than face such a hostile and unpredictable environment.

All this is happening while housing prices soared by 12.2% in the first quarter of 2025, the largest increase in nearly 20 years. In commuter towns around major cities, property prices have doubled in just five years. How does the government expect a young family to buy a home when they need to save 30% upfront, and rent consumes more than 38% of their income?

The Money Is There. The Demand Exists. What’s Failing Is the Administration.

The most frustrating part is that there’s no shortage of investors, demand, or financing. What’s lacking is real political action. The sector is calling for land to be released, bureaucratic procedures to be streamlined, and taxes and fees to be reduced. Above all, legal certainty for construction is essential. But the only response from the government is to create more obstacles, impose more taxes, and increase administrative costs in the final price of housing. Instead of solving anything, they continue blaming investors and developers—refusing to look inward at their own sluggishness and lack of foresight.

Up to 30% of the cost of a new home in Spain goes to permits, fees, and taxes. A crushing burden that no PERTE can fix.

Spaniards Work 51 Days More to Pay Taxes Since Sánchez Took Office

As if that weren’t enough, the state continues increasing its tax revenue at the citizens’ expense. According to recent data, Spaniards now work 51 more days per year just to pay taxes compared to 2018. This situation weighs heavily on the middle class and effectively excludes thousands of families from accessing decent housing.

Conclusion: A Social Time Bomb with a Lit Fuse

The administration can no longer blame “vulture funds,” “speculative capitalism,” or private landlords for a crisis they themselves have created. If bold action isn’t taken now—liberalizing land, simplifying permits, reducing taxes and fees, and encouraging private investment—we face an inevitable social breakdown. Entire generations will be condemned to precarious rentals or forced to live with their parents indefinitely.

Housing is not a luxury. It’s a right. And the administrations are failing spectacularly to guarantee it.