Decree-law 17/2019 of 23 December, published in the DOGC on 30 December, takes effect on the 31st. It extends the duties of large holders, regulates empty homes and raises the protected-housing reserve.
Decree-law 17/2019 of 23 December, on urgent measures to improve access to housing, was published in the Official Gazette of the Generalitat of Catalonia (DOGC) on 30 December and takes effect the following day. It amends several Catalan housing and planning laws and, like any decree-law, must be ratified by the Parliament of Catalonia within thirty days of its promulgation. Its preamble justifies the urgency by the persistent difficulty of access to decent housing, and it seeks to increase the supply of homes at moderate prices, especially protected rental housing.
Who the large-holder concept applies to
The definition is in Act 24/2015, on urgent measures against the housing and energy-poverty emergency. Until now, a legal entity was a large holder if it owned more than 1,250 square metres of living space. Under the decree it is one that, alone or through a group of companies, owns more than 15 homes, and the definition extends to venture capital and asset securitisation funds and to individuals with more than 15 homes. Certain social developers are excluded, as are those with more than 15% of their living space classified as protected rental housing.
In practice, an owner with up to 15 homes is not a large holder. A family company with a bigger portfolio may be, even if it spreads it across several companies in the same group.
What duties and measures it contains
A large holder must offer a social rent proposal before bringing certain lawsuits, and the decree extends those cases: enforcement actions arising from a mortgage debt, evictions on expiry of the title that allows occupation (for three years) and evictions for occupation without title when certain conditions are met, such as the occupation having begun at least six months before the decree or the municipal services reporting favourably. The offer is notified to the town council and the Housing Agency within three working days, applies also to proceedings already under way and failing to comply is an infringement in housing matters. If, when the contract ends, the family is still in a situation of residential exclusion, it has the right to renew it once.
As for empty homes, the decree defines them as those that remain permanently and unjustifiably unoccupied for more than two years. Justified causes are relocation for work, a change of address because of dependency, abandonment in rural areas that are losing population and pending court litigation. If the home belongs to a private legal entity, after a formal notice the administration may impose coercive fines of €1,000 per home per month, up to 50% of the estimated price, and the power to expropriate its use or ownership is widened.
On planning, municipal plans must reserve for protected housing at least the land corresponding to 30% of new residential floor area. In the Barcelona metropolitan area the minimum will be 40% on designated developable land and in non-consolidated urban sectors that change to residential use, with the possibility of dropping to 30% where economic viability cannot be guaranteed, and at least half will be for rent. The Catalan government must approve within a year a sectoral territorial plan with even higher reserves in high-demand areas.
The decree also regulates pre-emption and redemption rights. The Generalitat has a statutory right of first refusal over sales of private land reserved for protected housing and of rented homes transferred together with the other homes or premises in the same building, and Barcelona City Council holds the same rights over assets located in the city.
What to review
Anyone who holds homes in their name can count how many there are and, if they own companies, how many the group totals. A large holder should review any claims under way, because the duty to offer social rent reaches proceedings already started. It is also worth going over homes left empty for more than two years and the grounds for it, and keeping the pre-emption and redemption rights in mind before selling a property with tenants. Ask your adviser how it applies to your case.
The key to the decree is how many homes are held and how they are used.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
