“The Ideological Battle in Spanish Politics: Housing Law and Mortgage Guarantees at Odds”

Housing has become for weeks one of the main electoral drivers of the municipal and regional pre-campaign. The agreement to unblock the first democratic housing law in Congress was the first step on a path that has led the Prime Minister, Pedro Sánchez, to star in numerous announcements on this matter in recent days.

Among all, it has been the last one that has caused a side effect directly related to United We Can, one of the spaces of the coalition Executive. Sánchez advanced last Sunday, during a pre-campaign act in Tenerife, a line of guarantees from the ICO to guarantee 20% of the mortgage to young people under 35 years of age and vulnerable families with dependent minor children.

From Unidas Podemos, the rejection of this initiative, which the Popular Party had previously proposed and which would have the approval of financial institutions and banks, was transferred from the outset. In the opinion of the confederal space, it supposes, de facto, help inflate a housing bubble that has not given the families a break.

“The problem is not that young people do not have money for a mortgage down payment, it is that they do not have money for a mortgage”, say some voices from UP, who ask to address the problem of buying a house in a structural way, it is say, tackling the high prices in the market.

In fact, Sánchez’s announcement and the PSOE’s electoral commitment to housing in recent weeks has revived the proposal of the confederal space to limit the abusive rises in variable-interest mortgages that have been taking place as a result of rate increases interest rates decided by the ECB with the aim of containing inflation.

The second vice president of the Government, Yolanda Diaz, articulated a concrete proposal for the price of mortgages to return to the levels they were before the invasion of Ukraine by Russia and the outbreak of this war at the gates of the European Union; these prices would be temporarily frozen until there was control over inflation and the ECB finalized its policy of raising interest rates.

An ideological dispute that links to the housing law

For Unidas Podemos, the ICO endorsement measure announced by Sánchez diverts the focus from the turn that the coalition government wants to cause in the housing market, marked by the unblocking of a law that contains, for example, the regulation of rental prices in the so-called stressed market areas.

With the prices of the current market, and with the unbridled monthly mortgage payments (especially those with variable rates, although more and more, also those with a fixed rate), in UP they consider that the least of the “problems” to tackle is the coverage 20% of the mortgage for young people. In this sense, they have once again insisted on the Socialists with the proposal to roll back the quotas to pre-war prices and freeze them, although no details of the talks are known, beyond the fact that the PSOE would not be, for the moment, for the work.

The electoral dispute between the socialists and Unidas Podemos for housing is no longer just a struggle to see who can get the most revenue from an issue that is among the main problems of citizenship; behind (or in front of) all this, an ideological battle may be taking place to define the housing model, the same one that was waged when negotiating the law and rent intervention.