Key facts
- The definition of 'vulture funds' has been broadened to include small landlords.
- Urbagestión, a small consultancy, evicted Maricarmen Abascal after increasing her rent.
- Investment funds account for only 8% of Spain's rental market, according to the Bank of Spain.
- New legislation bans owners of more than two properties from evicting tenants until 2030.
- Approximately 70,000 eviction orders were reinstated after a pandemic-era law expired.
Spain is grappling with a housing crisis marked by rising rents and evictions, leading Prime Minister Pedro Sanchez to target "vulture funds." However, the definition of these entities is becoming increasingly broad, encompassing small landlords and companies that profit from the market. This has led to confusion and concern among small investors.
In the case of Maricarmen Abascal, an 87-year-old pensioner, her landlord was Urbagestión, a small consultancy that increased her rent significantly before taking her to court after her regulated contract expired. While not a large fund, the government has labeled such entities as 'vulture SMEs.'
The government's new legislation aims to protect tenants by limiting the activities of property owners, particularly those with multiple properties, and imposing rent freezes and automatic contract extensions. These measures follow a surge in evictions after a pandemic-era law expired, with tragic consequences for some tenants.
Critics argue that the policies, while intended to protect existing renters, may exacerbate housing shortages in the long term and disproportionately affect small investors who own fewer than ten properties. Many property owners have reportedly withdrawn units from the long-term rental market in response to the new regulations.