The proposal for the Law of Guarantee of the Right to Housing that United Podemos and other eight left-wing parties will register in Congress this Thursday proposes sanctions of up to 900,000 euros for not applying price limits in housing rental contracts in stressed areas to be established.

The text, over a hundred pages long, has been written by social organizations such as the Platform for People Affected by Mortgages, the Tenant Union, No Homeless Person, and the CCOO and UGT unions.

The proposal regulates in detail the rental market and the sanctioning system for very serious, serious and minor infractions in terms of income containment, with fines ranging from 3,000 to 900,000 euros.

The approach -which is the one that Podemos has been defending in the negotiation with the PSOE of the Law for the Right to Housing- is that the autonomous communities, once they enable their official rental price reference indices, will be able to declare areas of stressed residential market, with a maximum duration of five years, and determine in them a maximum rent.

These areas may be declared if the official reference index experiences a sustained growth clearly higher than the average for that community, if the average rental charge exceeds 30% of the average income of the urban area or the average income of the community or if the rental price has experienced accumulated interannual growth in the previous five years at least three percentage points above the CPI rate of the corresponding autonomous community.

From there, in the rental contracts the rent agreed between the parties may not exceed the corresponding official reference index or the price of the last contract in force in the last 5 years or the average of the contracts of that period.

The proposal provides for an exception in which the landlord could increase the price up to the maximum limit of 10% if it carries out works to improve the home.

Fines between 3,000 and 900,000 euros
The collection of rents that exceed the established limits will give the tenant the right to demand the restitution of the amounts received in excess and in the housing rental offers in those areas, information on the reference price must always be included.

Failure to provide this information, both in rental offers and in contracts, and applying a rent that exceeds the established limits by more than 10% will constitute a “very serious offense”, punishable by fines of 90,001 to 900,000 euros.

If the rent that is applied exceeds the limits by more than 8%, the offense is considered “serious” and punishable by fines of 9,001 to 90,000 euros, while if the rent exceeds the limit by more than 4%, the offense would be “mild”, with a fine of 3,000 to 9,000 euros.

The other measures of the rule: evictions, supplies, fees …
In addition to rent regulation, the bill endorsed by Unidos Podemos contains measures to prevent evictions, guarantee gas, electricity and water supplies (with a social rate financed by companies), penalize empty homes (with surcharges of the 75% to 300% in the IBI and mandatory assignment for large holders) and cancel mortgage debts due to over-indebtedness.

It also returns the Socimis to the general tax regime, enables tourist rental control policies, extends the duration of lease contracts to 7 years for individuals and 12 years for legal entities.

It also establishes that the fees corresponding to the procedures carried out by real estate agents or intermediaries, whether in real estate sales or rental transactions, will be paid by the seller or lessor, respectively.

With the registration of this initiative tomorrow in Congress, Unidas Podemos intends to pressure the PSOE to include the limitation of rental prices in the housing law that they have been negotiating as government partners for almost nine months.

By Stephanie Holt

The Great Writer and The Passionate Poet As Well, He Graduated from University Of Florida in Journalism and Brad have around 12 years of experience in news and media section.

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