Spain Faces Housing Crisis as Protests Escalate, Election Called

Protests have erupted across Spain, with hundreds camping in Madrid's Puerta del Sol square to voice anger over a deepening housing crisis. Demonstrators blame "vulture funds" and investment firms for driving up rents and contributing to a shortage of affordable homes. The escalating unrest comes as Prime Minister Pedro Sánchez has called a snap general election.

University graduate Pierina Nicuray, 21, and film-dubbing student Jorge Moreno, 19, are among those camping in the capital. They echo sentiments widely shared by protesters and ordinary Spaniards: a lack of available housing, landlords exploiting the situation, and the impact of platforms like Airbnb. Moreno specifically pointed to investment funds buying properties and increasing rents until tenants are forced out. "They've been making a business of housing for a long time," he stated, "But it's an abusive business which stops Spaniards from being able to live in a decent home."

These concerns gained national attention following the case of 87-year-old Maricarmen Abascal. After an investment firm purchased her home, she was pressured to leave and faced sharply increased rent, which she ultimately could not pay. Although public outcry prompted the company to offer her return, she died in hospital before she could go back.

Carmen Pérez, a retired widow from Ecuador who has lived in Spain for 17 years, described her struggle to find affordable rent in the current market. She has been forced to move in with her daughter and son-in-law. "When a property is listed to rent, there's always a long waiting list," she said. "And the rent is always too high for me."

Rental costs in Spain have risen significantly, with an average increase of 84% over the last decade, according to property outlet Idealista. In some areas, such as the centre of Málaga, rents have increased by 113%, and in Marbella by nearly 150%.

A recent study by the Centre for Sociological Research (CIS) indicated that a majority of Spaniards want action against those perceived to be manipulating the housing market. Proposals included higher taxes for owners of 10 or more properties (72%), limits on short-term tourist rentals (76%), and expropriation of empty homes (40%).

However, some experts suggest the narrative may be more complex. Jorge Galindo, director at the Esade centre for economic policy, noted that available data makes it difficult to quantify the exact number of properties owned by "vulture funds." He cited Bank of Spain figures from 2024 showing that only 8% of rental properties are owned by companies, suggesting that a significant accumulation of rental properties by a small number of owners is not the primary driver of rising rents. Instead, he points to a fundamental shortage of supply relative to demand.

The Bank of Spain estimates Spain has a housing deficit of around 750,000 homes, a figure that could rise to one million by 2028. While Spain has 3.8 million empty properties, many are in rural areas or are awaiting renovation or caught in legal disputes, rendering them largely irrelevant to the urban housing crisis.

Demographic shifts, including a significant increase in new households driven by migration between 2021 and 2025, have outpaced new home construction. The country saw about 1.2 million new households but fewer than half a million new homes built during that period. Factors contributing to the slow construction rate include the shrinking of the construction industry after the Eurozone crisis, rising material costs post-Covid, and political or legal hurdles.

Short-term tourist rentals are believed to have a more localized impact on prices in specific urban areas, rather than contributing to the overall national increase. The crisis is further exacerbated by stagnant wages, with a study by El País finding that average Spanish purchasing power has decreased by 5% in real terms over the past decade due to taxes, social security, and inflation. The average salary in the Madrid region is €1,550 per month, with many workers struggling to afford rent, which can consume 75% to 80% of their income.