The Cost of the Housing Policy. An Analysis of the Different Spanish Public Administrations

Abstract

Between 1997 and 2002 there was a lengthy boom in the Spanish real estate market, which has caused a
sharp rise in the price of houses, which was immediately passed on down to ground prices and has led to a
significant shortage in the building of subsidized houses. This, in its turn has brought on a much higher debt
rate for Spanish families and, consequently, of a greater number of her citizens, and among these especially
young people, being all but incapable of meeting the cost of buying their own homes. Given this state
of affairs, it is here felt to be of prime importance to establish the volume of public resources earmarked
for the housing sector to thus ascertain the effort made by the different public administrations to meet the
situation. Said resources are here found to have stood at but 1,2% of the GPD, two thirds of the same going
to taxes and third to budgetary costs. Compared to other European countries, Spain is found to lag behind
the rest as far as public expenditure in the housing sector is concerned.The data confirming that the housing
policy has been in a decline over recent years and that its budgetary allocation has gradually fallen away
make the importance of the call for a more active role for housing policy altogether too apparent.