Subsidized housing in Spain is dead, killed by prices, bureaucracy and taxes

The current housing situation in Spain is simply shameful. For the first time since official records began, the average price per square meter of subsidized housing exceeds €1,170 across the country. And what is most scandalous is that in eleven provinces, this type of supposedly affordable housing is even more expensive than private housing. What is the point of talking about “subsidized housing” if it costs more than the market rate? The answer is clear: none. What we are seeing is not a one-off failure, but the result of a system deliberately designed to benefit a few at the expense of working families.

The responsibility lies squarely on the shoulders of public administrations. The central government, autonomous communities, and city councils compete with each other to see who can impose the most obstacles, taxes, useless paperwork, and political apathy, not to mention civil servants and architects from administrations creating obstacles, problems, and more difficulties. Far from facilitating access to housing, they hinder it at every turn. Developing, building, or buying a home in Spain has become a real bureaucratic nightmare. Licenses that take years to be granted, absurdly complex urban planning regulations, duplicate procedures between different administrations, chained fees, and disproportionate taxation. How can there be affordable housing if the administration charges a suffocating toll at every step of the process?

The autonomous communities, which have direct powers over housing, have turned social housing plans into a disguised business. Instead of protecting citizens, they protect business interests, opaque cooperatives, and developers who know how to navigate the bureaucracy and who are usually aligned with the ruling political party. It is “subsidized” housing in name only, because in practice it is neither affordable nor targeted at those who need it most. Young families, workers, the self-employed, retirees with modest pensions—all of them are left out of the system. Why? Because they cannot afford the inflated prices or the tax burden that the state itself imposes on something as basic as a home.

Local councils, for their part, have stopped using public land for what really matters: building social and affordable housing. They prefer to hand it over to speculative operations or projects with a public appearance that end up costing more than $250,000 or $300,000 per home. At the same time, they are tightening regulations, raising urban planning taxes, creating new fees, or demanding unnecessary technical studies just to justify their own inefficiency. Instead of being part of the solution, they are becoming yet another obstacle.

In Torrox, for example, where there is still urban land available, no areas are being planned for multi-family housing; everything is for tourist housing or second homes. This is a mistake, and we have many examples of such mistakes in the municipalities around us, such as Nerja, Frigiliana, and Torre del Mar.

Meanwhile, the average citizen is drowning. The working class is seeing the cost of everything related to housing rise: from the cost of land to construction materials, many of which are subject to 21% VAT, to notary, registration, and municipal fees. Buying or building a home means paying taxes at every step: ITP, AJD, VAT, municipal capital gains tax, urban planning licenses, building fees, special contributions… a fiscal drain that makes any real attempt at access impossible.

Social housing should be a tool at the service of the common good. But in Spain, it has become yet another instrument for raising revenue, punishing small developers, and discouraging private initiative from those who want to build or renovate. And what is most serious is that the very institutions that should be ensuring access to decent housing are the ones feeding this perversion of the system.

Today, social housing protects no one. Not young people, not families, not workers. It only protects the incompetence, short-sightedness, and voracious tax collection of an exhausted, ineffective public model that is deeply disconnected from reality.