A PERTE of rental housing?

The experience, not very explicit, but there it is, of the National/State Housing Plans, with their tortuous and cumbersome procedures, should be taken into account. The programmes and measures may have been inadequately designed, the procedures may have contributed, with their excessive bureaucracy, other factors may have been present, but, in short, it seems that all this made their implementation impossible. And yet the resources were much smaller in amount than what is now proposed, and even so it seems that they were not spent. Some programs were left blank. Let it not happen again. This is supposed to be the objective now.

Affordable or social rental housing has become a national priority. Resources have been significantly increased. It is required that they reach their destination, that they are spent and that they are spent well. A prerequisite then is that they are known. One of the factors that may have contributed most to the relative failure of the Housing Plans is the lack of information. Neither the citizens, nor the promoters, nor even the town councils, knew that they could apply for these resources, whether they were sufficient or not.

As much as inter-administrative co-governance must be trusted and encouraged, the central administration cannot budget aid of close to 5,000 million euros and have its application depend only on its distribution, with whatever criteria, among the Autonomous Regions and on whether or not they want to apply it. It would seem that, at the very least, an aggressive new information campaign would be called for, calling for the presentation of projects, encouraging them to emerge, as we have already said, “from below”. Moreover, the direct relationship between the central public body and the specific project could be foreseen to materialize through the direct payment, and in advance, of part of the subsidy, precisely to ensure its implementation.

In the face of the European manna, proposals are being formulated. They are large projects or the sum of not so large but grouped into packages, which can become “PERTE”, in the legislative jargon of the Recovery with transformation, RDL 36/2020 of 21 December. These are the Strategic Projects for Economic Recovery and Transformation. From what has been said, they refer to the electric vehicle, artificial intelligence, etc, that is to say projects that sound like science fiction ahead of the present. They might not be the only ones.

The projects present two major novelties. Firstly, their own innovative content, but at the same time another no less important one, the need to overcome bureaucratic obstacles, procedural bottlenecks or, in short, routines. They require doing things differently from the way they have been done, overcoming the two slogans of the anti-innovation argument: “that has never been done before” or, more conclusively, “it is illegal”. For this reason, the recent RDL introduces urgent measures for administrative modernisation in general. It cannot, however, enter into the overcoming of sectorial stumbling blocks and resistance, which many potential innovative projects would also require.

One of them could be a PERTE made up of a large number of new affordable rental housing developments, with prices below market prices, which could lead to a rapid increase in the number of units significant enough to influence the market. Its content is in fact innovative and has a great capacity for dragging the market along. It could also lead to greater industrialisation of the construction sector. Like others, it requires overcoming bureaucratic ties and restrictions, mostly urban planning and procedural.

What is missing? In this case, in addition to the necessary investment, which already seems to have been decided to apply, land is needed. To this we have dedicated previous deliveries. And, in addition, land in an acceptable location, both public and private.

It would then be necessary to attract these soils to the Project/PERTE. They would be expectant soils that would have to recognize their dragged unfeasibility, but that could see in the change an opportunity, although it would imply a reduction of the never achieved expectations. For this, it would be necessary to be able to break, as in the procedures, dragged limitations derived from the urban plans. That is, rigid land classifications, sclerotic qualifications found impracticable and other burdens that would require, casuistically, modifications of that rigid planning. It would be necessary to make punctual modifications, many at the same time and in a fulminant way Could we do it? That is certainly the challenge, but, as in other PERTEs, that is what this one would require. A few changes at a time in each city and simultaneously in different cities whose rental markets are strained. This is the only way to have a significant impact, necessarily quantitative, on those markets.

For this exceptional opportunity of a potential change in the promotional model, from ownership to buid to rent, it should be understood that, when we speak of “soils”, a range of possibilities should be understood, from the empty ones themselves, to the previously occupied ones susceptible of regeneration/substitution, or those that would mean building on top of what has already been built. Something that we have already pointed out in our delivery 6 of this saga.

It is now a question of pointing out the bases of a PERTE of rental housing. It would be an exercise of obligatory co-governance, as they now say, between the three levels: Central Government, an Autonomous Region and a City Council. The central government would provide the funding and, where appropriate, tax exemptions. The autonomous government would be freed from the legal constraints, in the way that the aforementioned Royal Decree Law (RDL) does, including above all the coverage of planning modifications, as well as the requirements to reduce the resulting rental prices, below market, with respect to the official indexes of these, of the Ministry of Transport, Mobility and Urban Agenda (MITMA). The corresponding City Council would have selected the enclaves where to produce each of the promotions, on its own initiative or at the proposal of private parties, having agreed to undertake them with the private owners of the land/buildings where to produce them, as well as, in each case, with the fund/developer/manager that is going to undertake them, agreeing on the maximum rental prices, below market. The best thing would be for the corresponding Autonomous Region to participate in the agreements. A sequential and integrated concentration of protocols between the different actors that undoubtedly exceeds what is usual. The PERTEs are characterised by this: it has never been done before and yet it is necessary, precisely because of what it implies in terms of changing previous patterns.

It undoubtedly appears to be a difficult, even impossible process, especially if it is to be developed quickly, in line with the European financing-recovery calendar. However, this would be a unique opportunity to do so. Exceptional European resources, supported by the agreements conceptually described above, could have a significant effect on the rental housing market.

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